Statoil, Rosneft sign landmark Barents Sea deal
The two companies could invest $35-40 billion in developing fields in the Barents Sea in a new joint-venture where Statoil will get 33,4 percent of the shares, according to the landmark agreement signed in Moscow on Saturday.
Statoil CEO Helge Lund and Rosneft president Eduard Khudainatov signed the agreement, in the presence of the Russian Prime Minister Vladimir Putin and Deputy Prime Minister Igor Sechin. The agreement is the last international agreement Vladimir Putin attends as Prime Minister before returning to presidency on Monday.
The agreement opens for the largest ever industrial investment north of the Arctic Circle. The Perseyevsky field on the Russian side of the maritime border in the Barents Sea is very promising.
“If these resources are confirmed in the Perseyevsky field, investment in development and exploitation could reach $35-40 billion," Rosneft boss Eduard Khudainatov said to RIA Novosti after signing the deal with Statoil on Saturday.
Rosneft without offshore experience
Rosneft welcomes Statoil as partner in the High North for good reasons. The Norwegian oil-major has important experience in the north, operating the Hammerfest LNG plant, supplied with gas from the Snøhvit field in the Barents Sea. Rosneft has no offshore experience.
Last year, Statoil announced two major oil discoveries in the Norwegian sector of the Barents Sea. The Skrugard and Havis fields will be the two northernmost oil-fields on the Norwegian continental shelf.
The Perseyevsky field is located in the northern part of the Barents Sea, east of Norway's Svalbard archipelago and west of Russia's Franz Josef's Land. This is waters that can be partly ice-covered during the polar night period in the winter.
The ruff Arctic climate does not scare Statoil’s Helge Lund from exploring the potential resources in what could be the world's northernmost oilfield.
“This cooperation agreement is an important milestone in Statoil’s exploration activity in Russia. The agreement secures a long term collaborative position with Rosneft in large, prospective frontier areas in the Barents Sea and the Sea of Okhotsk. By building on both companies’ competence and experience, this agreement is a significant step further in the industrial development of the Northern areas, says Helge Lund, CEO of Statoil in a comment posted on the oil company's portal.
The field Rosneft and Statoil jointly will explore is in the northernmost part of what Norway and Russia until 2010 defined as the disputed part of the Barents Sea. The maritime border agreement between the two countries was annonced in April 2010 and entered force on July 7th last year. Norway started its seismic survey for oil the day after.
Three Far East licences
In addition to the Barents Sea Perseevsky licence, three other licences are included in the Statoil, Rosneft deal. They are the Kashevarovsky, Lisyansky and Magadan-1, north of Sakhalin island in the Sea of Okhotsk in Russia's Far East.
In total, the four offshore licences cover an area of more than 100,000 square kilometres, equalling approximately 200 blocks on the Norwegian continental shelf.
Statoil says they will fund the initial exploration necessary to determine the commercial value of the four licences.
First drilling in 2020
The Perseevsky licence in the Barents Sea covers 23,000 square kilometres in water depths of 150-250 metres. Statoil and Rosneft already have the timeframe for the development ready: 5,500 line kilometres of 2D is to be acquired by 2016, 1,000 square kilometres of 3D by 2018 and a first exploration well is to be drilled by 2020, Statoil says in Saturday's press-release.
The deal with Norwegian Statoil is the third major Arctic offshore deal Rosneft signs with foreign companies, following agreements with U.S. ExxonMobil and Italy's Eni in April.
Rosneft enters Norwegian shelf
Under the agreement Rosneft will have the opportunity to acquire stakes in Statoil’s exploration and development projects and assets at blocks in the North Sea, as well as in the Norwegian section of the Barents Sea.
Rosneft and Statoil also announced intentions to place orders with Russian shipyards for the construction of ice-class vessels and drilling platforms, Rosneft says in an article posted on the company's portal.