Energy services firm Petrofac has paid a £569,000 penalty for breaching Russia sanctions rules, HM Revenue & Customs (HMRC) confirmed. The company self-reported the breaches, which occurred in 2022 and 2023 while it was winding down its Russian operations.
Details of the Breaches
HMRC investigated Petrofac after the self-report and found that the company supplied sanctioned industrial goods to individuals connected to Russia and made them available for use in the country. It also violated regulations by providing technical assistance related to those goods.
Edwige Hill, deputy director in HMRC’s Fraud Investigation Service, stated: “Non-compliance with Russia sanctions is a serious offence and together with our international partners, the UK Government has implemented the most severe package of sanctions ever imposed on a major economy.” She added that naming those involved aligns with other enforcement partners and sends a clear message on the consequences of breaching sanctions rules.
First Public Naming for Compound Settlement
Petrofac is the first company to be publicly named by HMRC for accepting a compound settlement, a type of penalty that allows the firm to pay a sum and avoid legal proceedings. The £569,000 penalty reflects the seriousness of the violations.
Company Background and Recent Developments
Petrofac builds and manages energy infrastructure, including oil and gas production, refineries, and renewables, primarily in the Middle East and the UK North Sea. Its UK business, based in Aberdeen, operates North Sea oil platforms for BP and Shell.
In October last year, Petrofac filed for administration following the collapse of a renewables contract in the Netherlands. Its asset solutions business was acquired by CB&I in April, preserving thousands of jobs, and it recently sold its Emirates engineering and construction business.
