ExxonMobil Corp.’s biggest international exploration opportunity may be imperiled by Russian President Vladimir Putin’s Ukrainian foray.

US-based companies could face restrictions on doing business in Russia if Putin’s regime is slapped with sanctions by western governments or the United Nations for its intervention in Ukraine’s Crimea region.

Exxon, under the terms of a 2011 contract with state- controlled OAO Rosneft, owns drilling rights across 11.4 million acres of Russian land, its biggest exploration holding outside the U.S. Sanctions could stall Exxon’s plans to begin drilling in the Russian Arctic later this year in partnership with Rosneft, and threaten the lucrative Sakhalin-1 oil license off Russia’s Pacific Coast.

“We don’t take sides in any geopolitical events,” Exxon Chairman and CEO Rex Tillerson said during a meeting with reporters in New York. “We have navigated these kinds of challenges before.”

The turmoil in Crimea and international reaction to the situation hasn’t affected Exxon’s operations in the Russian oil sector, he said. “We’ve seen no impact on any of our plans or activities at this point, nor would we expect there to be, barring governments taking steps beyond our control,” Tillerson said.

Reverse Slide

Russia holds “some of the largest undiscovered potential in the world,” the Irving, Texas-based company said in a slide presentation prepared for a meeting with analysts. The company described the western Siberia reservoirs it intends to begin drilling this year as a “world-class hydrocarbon system.”

Tillerson agreed to invest billions of dollars and allow Rosneft to buy stakes in premier North American projects in exchange for access to Russia’s vast Arctic, deep-water and shale resources. Exxon plans to begin pumping oil from the 600 MMbbl Arkutun-Dagi project off Russia’s Pacific coast later this year, Senior Vice President Mark Albers told analysts today.

Tillerson is seeking to reverse a two-year slide in oil and natural gas output at the world’s biggest energy producer by market value. Since assuming the leadership of Exxon in January 2006, the company’s stock has increased 67%, lagging the 83% advance in the price of crude, according to data compiled by Bloomberg.

Exxon was down 2.6% to US $93.90 at 1:24 p.m. in New York, after earlier sliding the most on an intraday basis since February 2013. Exxon is the worst performer in the Standard & Poor’s 500 Index today.

Capital Projects

Exxon plans to spend $39.8 billion on new wells, offshore oil platforms, gas-export facilities and other capital projects, according to today’s slide presentation. Capital expenditures will drop below $37 billion annually during the 2015-2017 period, the company said.

Oil and natural gas output will be flat this year before rising an average of 2% to 3% annually through 2017, Exxon said.

Exxon’s 11.4 million acres of Russian drilling rights are eclipsed in size only by the company’s 15.1 million acres in its home country, according to a filing with the US Securities and Exchange Commission on Feb. 26. The next largest Exxon holdings are in Canada, Germany, and Indonesia, where the company owns rights to 6.3 million acres, 5 million acres, and 2.3 million acres, respectively.

Regional Interests

Exxon’s interests in the region aren’t confined to Russian oil fields. The company dispatched high-level executives to the Ukraine’s capital of Kiev six weeks ago to discuss exploring the country’s vast shale deposits, Interfax reported on Jan. 23, citing the website of then-President Viktor Yanukovych.

Yanukovych was ousted amid violent streets protests in late February and has since fled to Russia. The January meetings included Exxon executives Stephen Greenlee and Kevin Biddle, according to the Interfax report.

Exxon said today that it continues to seek Ukrainian government permission to explore the Skifska block on the northwest edge of the Black Sea. The disclosure involved a single line of type in a 72-page document prepared for today’s meeting with analysts. No other details were provided.

The Russian turmoil comes at a time when Exxon’s exploration efforts have stalled worldwide and costs to pump oil and gas from the ground are rising.

The company found commercial quantities of oil or gas in 67% of the exploratory wells it drilled in 2013, unchanged from 2012, according to the Feb. 26 filing. At the same time, Exxon’s costs to produce the equivalent of a barrel of crude jumped to $11.48 last year from $9.91 in 2012.

Exxon’s Russian drilling rights include 11.3 million acres in the Kara and Black seas under the agreement with Rosneft, and another 85,000 offshore acres beneath the Sea of Okhotsk near Sakhalin Island. Rosneft is a partner in the Sakhalin-1 development, which began producing crude in 2005.