In the 12-month ending June 2023, India imported 4.57 million barrels per day, of which roughly 30 per cent came from the four Russian companies, data sourced from Kpler, a commodity market analytics firm, shows.
Also, GK Satish, a former board member of state-owned oil major Indian Oil Corporation, is now on the board of Rosneft Oil Company. The US Treasury’s Office of Foreign Assets Control included Rosneft Oil Company in the SSI (Sectoral Sanctions Identifications) List on July 17, 2014, over Russia’s role in the Ukraine crisis. The latest updated list continues to list Rosneft as a sanctioned entity.
Satish was on Indian Oil board from September 1, 2016 till his retirement as Director (Planning and Business Development) on August 31, 2021, and is now the Managing Director in a private company called ValPro Private Ltd. In a press release dated June 30, 2023, Rosneft said Satish was elected to the board by its shareholders as an independent director.
According to a former revenue department official, sanctions by the US government do not mean anything for an Indian citizen if his or his company’s operations are limited to India. “But if he owns a company which does business in the US, then he may attract the attention of enforcement agencies in the US,” the official said.
An Indian Oil spokesperson did not respond to queries.
Over energy imports from Russia, the Indian government has been steadfast in its stance that it would continue to buy oil from Russia for its own energy security. External Affairs Minister S Jaishankar had said last April that the quantum of oil India buys in a month from Russia is less than Europe’s energy purchase in an afternoon.
An executive in a global legal firm, who did not wish to be named, however, said boards of organisations must be vigilant since they can become the target of enforcement agencies in countries that impose sanctions. For instance, ex-Chancellor of Germany Gerhard Schroeder had to step down from the board of directors of Rosneft in May 2022, after the European Parliament urged he be blacklisted unless he quit it.
Rosneft owns and operates a string of offshore entities in tax haven Cyprus. And its former CEO, Eduard Khudaynatov, who is 63 now, is also the ultimate beneficial owner in some Cypriot entities, according to data accessed by the International Consortium of Investigative Journalists (ICIJ).
Cypriot companies linked to Khudaynatov are: Emiand Investments Ltd (incorporated in February 2014, he is a shareholder); Vostok Oil Cyprus Limited (incorporated in August 1998, he is the UBO); Miasdor Investments Ltd (incorporated in February 2014, he is a shareholder); Geltome Limited (incorporated in April 2011, he is the UBO); and Daumier Investments Limited (incorporated in May 2006, he is the UBO). All these five firms are “active”, the documents show.
Rosneft has been a steady supplier of crude oil to India for many years.
Khudaynatov is said to be close to Russian President Vladimir Putin and presently owns the Independent Oil and Gas Company. He was appointed Chief Executive Officer of Rosneft on September 6, 2010 and served in the capacity for more than two years. A Forbes report in June 2022 reported that US authorities identified him as the proxy owner of two mega yachts: the 459-foot Scheherazade, which is linked to Putin, and the 348-foot Amadea, which the US Department of Justice found is ultimately owned by sanctioned Russian gold mogul Suleiman Kerimov.
Rosneft itself appeared linked to four Cypriot firms: GPOB Limited (opened in November 2012); Rosneft International Holdings Limited (opened in April 2016, owned by ‘Rosneft Oil Limited’); Martanco Holdings Co. Ltd (opened in September 2001); and Novy Investments Limited (opened in April 2011, ‘dissolved’ in August 2020 ‘due to merger”).
Emails sent to Rosneft and Khudaynatov, and the other three companies Lukoil, Gazprom and Surgutneftegas, did not elicit a response.