Rosneft, Statoil Sign Landmark Arctic Shelf Deal

Russian state-run oil major Rosneft signed a multibillion dollar joint venture deal with Norway’s Statoil energy firm on Saturday to jointly develop four offshore hydrocarbon deposits in Russia’s Arctic and Far East, Rosneft said.

Statoil will get a 33.4 percent share in the joint venture. The two companies could invest $35-40 billion in developing fields in the Barents Sea and $30-60 billion in deposits development in the Sea of Okhotsk.

Overall forecast investment by Rosneft and Statoil in the development of the fields on the Barents and Okhotsk shelves could reach from $65-100 billion, Rosneft boss Eduard Khudainatov said.

“If these resources are confirmed in the Perseyevsky field, investment in development and exploitation could reach $35-40 billion and for the other three (Okhotsk) fields, $10-20 billion each,” he said.

The Norwegian oil giant will finance all geological prospecting of the Perseyevsky deposit in the Barents Sea in Russia’s north and the Lisyansky, Kashevarovsky and Magadan-1 fields in the Sea of Okhotsk in the Russian Far East.

The sites hold overall recoverable reserves estimated at over two billion tons of oil and 1.8 trillion cubic meters of gas.

Investment in geological prospecting at the four deposits will amount to $2.5 billion, Rosneft President Eduard Khudainatov said.

Rosneft will have the right to participate in Statoil’s development and production projects in the North Sea and in the Norwegian sector of the Barents Sea as part of the deal, the company said.

The deal is the third major tie-up for Rosneft with foreign companies to exploit the Russian continental shelf, following agreements with U.S. ExxonMobil and Italy’s Eni in April.

Under existing rules, only Russian companies with over 50 percent state ownership and no less than five years experience working in marine exploration are allowed to develop the Russian continental shelf. Only Rosneft and Russian gas giant Gazprom currently meet these requirements and can involve other companies in the shelf development through joint ventures.

The Russian government decided in early April not to levy export duties on new hydrocarbon development projects on the Russian shelf. Other duties and taxes will also be low or fixed for 15 years from the production start date.

Currently Statoil is only involved one project in Russia, a 24 percent stake in the Shtokman gas project. The Shtokman field is located 600 kilometers northeast of Murmansk in waters up to 340 meters deep. C1 resources in the license territory amounts to 3.8 trillion cubic meters of gas and 53.4 million tons of condensate.


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Ria Novosti

Ria Novosti

RIA Novosti was Russia's leading news agency in terms of multimedia technologies, website audience reach and quoting by the Russian media.

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