Ukraine has identified Chinese oil and gas companies as sponsors of the Russian war

This information is reported by the press service of NAPC.

The companies added to the list of international sponsors of the war are: China National Offshore Oil Corporation (CNOOC Group), China Petrochemical Corporation (Sinopec Group), and China National Petroleum Corporation (CNPC). CNOOC Group is China’s third-largest national oil company and the largest offshore oil and gas producer in China.

Its subsidiary, CNOOC Limited, along with another Chinese company, CNPC, each own a 10% stake in the Arctic LNG 2 project located on the Gydan Peninsula in the Russian Arctic region. The capital investment for the full-scale launch of the Arctic LNG 2 project is estimated at $21.3 billion. Despite the full-scale war launched by Russia against Ukraine, the company did not cease its cooperation with the aggressor country.

In July, they completed the construction and launch of the first line of liquefied natural gas (LNG) production on a floating gravity-based platform for the Arctic LNG 2 project, which was personally attended by Vladimir Putin. The implementation of this project could increase Russia’s share in the global market of liquefied natural gas (LNG) to 15%, as opposed to its current share of about 8%. Sinopec Group is China’s second-largest state-owned company, engaged in fossil fuel extraction and specializing in crude oil refining. In late March 2022, the company announced its intention to continue purchasing crude oil and gas from Russia, even if Western countries tighten sanctions.

The company owns a 10% stake in PJSC Sibur Holding, a Russian company, and during the first half of this year, only this Russian holding paid taxes in the amount of $347 million to the Russian budget.

Sinopec, through its subsidiary, Sojitz Hong Kong Holdings Limited, also owns a 40% stake in LLC Amur Gas Chemical Complex. In 2022, this enterprise paid taxes of 2.1 billion rubles (or $30 million) to the Russian budget.

China National Petroleum Corporation is China’s largest national oil and gas corporation and one of the world’s largest energy companies engaged in oil and gas extraction. It is integrated with major Russian oil and gas companies and the Russian government. As the company holds stakes in Russian companies, it pays taxes that Russia can continue to use to wage war against Ukraine.

It is worth noting that as of January 1, 2023, the aggressor state’s government has increased the profit tax rate for LNG exporters from 20% to 34% for a period of three years. This means that taxes from the export of liquefied natural gas (LNG) will nearly double (+70%), increasing the Russian budget’s revenue. Additionally, on September 28, NAPC proposed sanctions against 47 Russian diamond companies.

Photo: open sources