Pricey ice: Russia, Norway sign megabuck Arctic agreement

Reuters / NTB Scanpix
Statoil and Rosneft will spend about $60 bln to jointly explore and develop Russia’s Arctic shelf. This will allow another foreign company access to Russia’s oil and gas deposits, while domestic partners are still to be selected.

The deal between the Russian and Norwegian state-controlled companies provides for a joint venture to explore an area in the Barents Sea, as well as three sections in the Sea of Okhotsk. Combined projected resources at the four sections come to roughly 2 billion tonnes of oil and 1.8 trillion cubic meters of gas.

Under the deal, the Norwegian oil company will receive a 33.3% stake in the venture, with Rosneft getting the opportunity to acquire a stake in Statoil projects and assets in the North Sea, as well as in Norwegian sections of the Barents Sea.

It is agreed that Statoil will fully finance the geological exploration work. On top of that, the Norwegian party will reimburse historical expenses incurred by Rosneft, as well as 33.3% of expenses incurred by the Russian company during the course oflicense acquisition.

The cooperation terms for Statoil came as typical for all of Rosneft’s foreign partners, with American ExxonMobil and Italian ENI getting the same conditions. Earlier in April, Rosneft got access to ExxonMobil projects in the US and Canada, the parties having agreed on their cooperation in Russia back in 2011. The agreement between Russia’s oil company and ENI embraces areas in the Black and Barents Seas.

“This third straight large agreement with a foreign partner highlights Rosneft's strategy to accelerate Russia's offshore exploration and mitigate relevant risks via the careful choice of several strategic partners with high international standing,” say Troika Dialog analysts.

Meanwhile, not a single private Russian company  has a similar agreement with Rosneft for operations in the continental shelf. In the first half of April Rosneft sent proposals on the joint development of 12 shelf sections to the main private players in Russia's oil industry, which includes Lukoil, TNK-BP, Surgutneftegas and Bashneft. So far, just the first two have confirmed their participation, Khudainatov said, adding that the competition will be tough.