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No more Norwegian drilling for Rosneft, yet

Igor Sechin (center) and his Rosneft cooperated closely with the North Atlantic Drilling Ltd at the University 1 well in the Kara Sea.

The closing of the comprehensive deal between Rosneft and the North Atlantic Drilling Ltd is being delayed.

Speculations about the state of affairs in relations between Rosneft and the North Atlantic Drilling Ltd multiplies as a comprehensive corporate deal between the companies is being delayed by close to half a year.

In a press release, the NADL informs that the closing of the deal will be made only in late May 2015. That was originally planned to happen in the course of this year.

The companies stress that they both remain commited to the transaction. However, western sanctions could ultimately jeopardize the whole cooperation. NADL representative Rune Magnus Lundetræ openly admits to newspaper Dagens Næringsliv that his company needs more time to assess the essence of the sanctions and that the signing of the deal consequently has to be postponed. 

The NADL, a subsidiary of Seadrill, is traded on the New York Stock Exchange, and the company relies on an approval from U.S regulatory authorities. Although the deal was announced before the coming into force of U.S sactions against the Russian oil industry, experts believe the process could run into trouble.

Rosneft and NADL in May this year announced an Investment and Cooperation Agreement which would give the Russian company a 30 percent stake in the latter. The deal also includes the execution of six offshore drilling contracts with Rosneft and NADL’s acquisition of approximately 150 land drilling from Rosneft’s land drilling fleet in Russia.

Rosneft has put major efforts into the cooperation with NADL, which is sees as a prerequisite for its ambitious drilling plans in Russian Arctic waters. With the deal between the companies unsigned, Rosneft risks missing great parts of its planned Arctic well drilling program for 2015.

The cooperation deal has an original frame of $965 million, of which Rosneft will pay $300 milllion in cash. According to RBK, the deal also includes an option for NADL to acquire the Russian assets of the company Weatherford, assets which Rosneft got control of earlier this year.