Behind the deep ties between Exxon's Rex Tillerson and Russia

Rex Tillerson in 90 seconds
Rex Tillerson in 90 seconds

In 2013, Vladimir Putin awarded ExxonMobil CEO Rex Tillerson the Order of Friendship, one of the highest honors Russia gives to foreign citizens.

The silver badge underscores the close ties that have existed for many years between Russia and Tillerson, the leading candidate to be President-elect Donald Trump's secretary of state.

The 64-year-old Tillerson, a lifetime Exxon employee, came up through the ranks by managing the company's Russia account.

In fact, his close relationship with Russia is one of the major reasons Tillerson was selected to succeed Lee Raymond as CEO of Exxon (XOM) in 2006, according to Steve Coll's book "Private Empire: ExxonMobil and American Power."

Once he became CEO, Exxon bet billions on Russia's vast but notoriously-elusive oil resources through a bold partnership with Russian oil giant Rosneft. Putin himself attended the 2011 signing ceremony for the deal with Rosneft, which is majority owned by Moscow.

Russia has already indicated it would welcome Tillerson being named America's top diplomat.

"Trump continues to amaze," Alexey Pushkov, the head of the foreign affairs committee in the lower house of Russian parliament, said on Twitter. He said that selecting Tillerson would be a "sensation" and noted he has "a lot of experience working with Russia."

But Tillerson's close links to Russia are likely to receive scrutiny from U.S. lawmakers should he be nominated.

Russia faces U.S. sanctions over Moscow's annexation of Crimea. This weekend, a bipartisan group of U.S. senators called for an investigation into Russia's role in the 2016 election. The lawmakers said reports of Russian interference "should alarm every American."

Rex Tillerson Exxon Vladimir Putin
Rex Tillerson and Russian leader Vladimir Putin in 2011 at the signing of Exxon's deal with Rosneft.

Trump praised Tillerson on Fox News Sunday as "much more than a business executive" and a "world-class player." Trump cited the fact that Tillerson "knows many of the players" and does "massive deals in Russia" for Exxon.

Tillerson's biggest deal in Russia was announced in 2011 with Rosneft. The companies were focused on drilling for oil in three key Russian regions: the Arctic, the deepwaters of the Black Sea, and Siberia.

In 2012, Igor Sechin, a close ally of Putin and chairman of Rosneft, hailed the partnership as a "giant leap forward" and argued it's "more ambitious than man's first walk in space or sending a man to the moon."

The Exxon deal meant a great deal to Russia. Sechin, who was also then the deputy prime minister of Russia, bragged that after the Exxon agreement was signed, the valuation of Rosneft soared by $7 billion in just five days.

The partnership also gave Rosneft the chance to get a stake in Exxon's North American projects, including ones in West Texas and in the deep waters of the Gulf of Mexico.

Tillerson himself seemed hopeful that the Exxon deal could lead to even closer ties between the two countries. "It cannot be anything but helpful to broadening the relationship between the American people and the Russian people," Tillerson said at the time.

Putin later awarded Tillerson the Order of Friendship, which is given to foreign citizens for "special merits in strengthening peace, friendship, cooperation and mutual understanding between peoples." It is also awarded for those who make a "great contribution" to "large-scale economic projects" in Russia.

In 2014, Exxon was hit hard by a round of U.S. and European Union sanctions that targeted Russia for its intervention in Ukraine. Exxon said it could have lost up to $1 billion due to the sanctions, according to regulatory filings.

Exxon would likely stand to gain if sanctions are lifted on Russia by the new administration.

"We are very anxious to get back to work there," Tillerson told industry analysts in March when asked if Exxon would be interested in restarting its venture with Rosneft in Russia.

Tillerson noted that it would take time to resume operations, especially in the Arctic, because "we had to dismantle all of the capability and the infrastructure" due to sanctions.

Tillerson said he's "thankful" the Russians haven't done anything to "make the situation worse." To the contrary, Tillerson said Russia has "done things to help us hang on to the rights we have" in the wake of the sanctions.

Social Surge - What's Trending

Mortgage

Newsletter

CNNMoney Sponsors