On Friday Russian President Vladimir Putin signed a decree which will transfer Russia’s Far-Eastern Sakhalin-1 oil and gas project, which is currently being led by Exxon Mobil, to a legal entity.

Under the decree, the Russian government will form a new legal entity which will take over the project, the investor rights, as well as the subsidiary of Exxon Mobil, Neftegas Limited, which holds Exxon’s 30% stake in the project. Russian oil major Rosneft, India’s ONGC Videsh, and Japan’s SODECO all also hold stakes in the project. Rosneft subsidiary Sakhalinmorneftegaz-shelf will manage the new venture.

Foreign stakeholders who wish to retain their stakes in the project will now have one month to announce their intentions. Those who wish to relinquish their stakes will receive compensation, minus the potential losses incurred by the production halt at Sakhalin-1 earlier this year.

Exxon Neftegas Limited had announced its intention to withdraw from the project in March following the onset of conflict in Ukraine. One month later it declared force majeure, bringing a complete halt to oil and gas production, from the 220,000 bpd the project had been extracting prior to the conflict in Ukraine.

Exxon has declined comment so far on the decree.

Russia has already followed this procedure with the Sakhalin-2 oil and gas project, where UK’s Shell and Japanese companies Mitsui and Mitsubishi were stakeholders. Shell chose to exit the venture, while both Japanese companies transferred their stakes to the new owner.

Yasutoshi Nishimura, the head of Japan’s Ministry of Economy, Trade and Industry, noted that although the project is not currently supplying energy to Japan, it was still judged as vital to the nation’s energy infrastructure.

Nishimura said in an interview on NHK-TV, “Japan is 90% dependent on oil supplies from the Middle East, but the Sakhalin-1 project is important in terms of diversifying import channels and ensuring stable supplies. Therefore, we would like to clarify the intentions of the Russian side and decide on specific further actions in close consultation with the parties involved.”