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Giant offshore licenses for small money

Russian state companies Gazprom and Rosneft get their many new offshore Arctic fields for a nice price.

For the modest sum of €65 million, the Russian state-owned Rosneft and Gazprom this week got licenses to five Arctic fields holding an estimated 4,2 trillion cubic meters of gas and almost 600 million tons of oil.

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The Russian government continues to generously grant state companies Gazprom and Rosneft huge fields in Arctic waters for small money. This week, Rosneft got the licenses to the Albanovskoye and Varnekskoye fields in the Barents Sea, while Gazprom got Morskoye, Nyarmeyskoye and Skuratovskoye fields in the Kara Sea, a press release from the federal government reads.

The two Rosneft fields hold an estimated 542 millon tons of oil and 1,2 trilion cubic meters of gas, while and the three Gazprom hold mostly gas, up to 3 trillion cubic meters. Again, the licenses are granted to the two shelf monopoly companies without any kind of tender.

The five licenses hold a total of about 585 million tons of oil, 4.2 trillion cubic meters of gas and more than 80 million tons of condensate, and cost the two companies the modest sum of 2.7 billion RUB (about €65 million).

The new resources, which now can be recorded on the quickly expanding offshore Arctic portefolio of the two companies, will will be enough to cover total EU-27 gas consumption for about eight years.

As previously reported, Gazprom and Rosneft are strongly pushing on government for control over the promising Arctic waters, and have over the last months secured the licenses to a great number of fields. Earlier this month, the government granted Gazprom another four licenses in the Barents Sea. In January, Rosneft got 12 new licenses, of them five in the Barents Sea. Before that, the state oil company got another two major licenses in the Pechora Sea. According to Kommersant, Gazprom is now also about to win seven more offshore licenses to fields located in the Kara Sea, in waters near the Yamal Peninsula.

In addition, Rosneft has got carte blanche in the Fedynsky, Tsentralno-Barentsevsky and Perseevsky structures, the areas located along the marine border to Norway and which are to be developed together with Eni and Statoil respectively. The company also controls huge waters in the Kara Sea which are to be developed together with ExxonMobil.

Both Gazprom and Rosneft will continue to fight for the remaining most prospective part of the Russian Arctic shelf. And the Russian government is likely to give it all away for a very nice price.