New law opens Russian shelf for foreigners

Offshore drilling

A new bill from the Russian Ministry of Environment will deprive Gazprom and Rosneft of their monopoly position on the shelf and open the door for foreigners.


The bill will allow foreign companies to engage in production on the Russian shelf. It has already been coordinated with other federal ministries and is currently on the table of the government, newspaper Vedomosti reports.

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With the legislative amendments, Gazprom and Rosneft will lose their monopoly position on the shelf. Until now, only the companies with more than five years of offshore experience have been granted the right to engage in shelf projects, a rule which has left the two state-controlled companies in comfortable control of shelf developments.

Both of the two companies have formed several alliances with foreign companies, among them Gazprom’s consortium with Total and Statoil in the Shtokman project and Rosneft’s partnership with ExxonMobil in the Kara Sea.

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-A result of the bill will be that not only two, but rather 102, companies are allowed to the shelf, Vasilyevskaya told journalists. She specified that only companies with a bigger than 50 percent stake owned by the Russian state will have the right to own field production licenses, but that exploration licenses can be granted to subsidiary units of state companies with any state ownership stake, Reuters reports.

Vasilyevskaya also stressed that all operations on the shelf will require the application of additional environmental demands and pointed at the major oil spill which last year took place in the Gulf of Mexico. reports.