Transneft sanctions: exclusion of "Druzhba"

In response to increasing international scrutiny of Russia, the list of 'relevant subsidiary company' in Transneft's license was expanded – now it includes any legal entity owned or controlled by PJSC Transneft. The Druzhba pipeline was added to Appendix 1 and is now considered an exception to the sanctions regime, provided it does not violate Russian legislation. According to sources, the deal will ensure continuity of oil supplies and continued dividend payments for entities not subject to sanctions. Restrictions remain for the rest of the segment, but Druzhba receives a 'cozy' exemption from international restrictions.

Context

In 2023, sanctions were imposed against Russian oil companies; new rules include exemptions for certain projects as long as they do not violate Russian law.