Russian natural gas giant Gazprom and the Anglo-Dutch energy giant Royal Dutch Shell have signed a tentative deal to develop hydrocarbons in the Russian Arctic, according to information provided on the official site of the Russia’s company.
The deal was signed by Gazprom CEO Alexei Miller and Jorma Ollila, chairman of the Royal Dutch Shell board of directors. The memorandum anticipates the joint prospecting and development of hydrocarbon offshore fields placed between the Chukchi Sea and East Siberian Sea and the other in the Pechora Sea.
If Russia’s company gets license, the Gazprom’s share will be 66.7% and Shell is likely to have a 33.3% stake in the fields, says Russian news agency Interfax. The agency adds the license can be obtained before May 1.
The memorandum states the principle of mutual access to the fields. That is why Gazprom gets option on Shell’s international project on prospecting and development of hydrocarbon offshore fields. According to Vedomosty, Russian business daily newspaper, the deal between the companies also envisages development of offshore oil fields in South Africa. There Russia’s company will have a 33.3% stake, whereas Anglo-Dutch oil and gas company 66.7%.
According to the deal, the exploration in the mutual projects in the Russia’s offshore will be mainly financed by Shell, on the contrary Gazprom will pay overseas exploration works.
The memorandum was signed in Amsterdam following negotiations between Russian president Vladimir Putin and Dutch Prime Minister Mark Rutte. Gazprom CEO Alexei Miller says that the deal is a framework agreement that envisages cooperation in the Arctic as a whole, and that it did not refer to any specific hydrocarbon deposits. Miller also reminded that Gazprom and Shell had been successfully cooperating for a long time, in particular it should be said about the Sakhalin-II project and the project on joint extraction of shale oil in the Khanty-Mansi Autonomous Okrug.
Russia’s energy firm Rosneft has early signed an agreement on development of offshore fields with ExxonMobil, Eni, and Statoil; the conditions were similar to ones of Gazprom and Shell. Only state-owned companies with good experience have the right to develop hydrocarbons in the Russia’s offshore fields, in fact Gamprom and Rosneft are the only appropriate companies.