BP, Rosneft Form Siberian JV
Russian state-controlled Rosneft and its 20%-shareholder, UK major BP, announced June 17 they had signed final binding agreements to form Yermak Neftegaz, split 51-49 in Rosneft's favour, to conduct exploration in the West Siberian and Yenisei-Khatanga basins in Russia.
The joint venture will explore two areas of mutual interest (AMI) in the West Siberian and Yenisei-Khatanga basins covering a combined area of about 260,000 km², BP said in a statement. It will first carry out further appraisal work on the Baikalovsky field, in the Yenisei-Khatanga AMI which Rosneft found in 2009; and exploring the Zapadno-Yarudeiskoe, Kheiginskoe and Anomalnoe licences in the West Siberian AMI.
BP told NGE that while there was a lot of prospectivity in the region it was too early to say what the oil-gas split might be.
Exploration activities in the two AMIs will include regional research, acquisition of seismic data and drilling of exploration wells, with the beginning of field works anticipated in the winter season of 2016-17.
Rosneft CEO Igor Sechin said the agreements "serve as an example of full scale cooperation with BP, Rosneft’s strategic partner and largest minority shareholder. After creation of the Taas-Yuryakh Neftegazodobycha joint venture we are now broadening the geography of our cooperation and creating a precedent which allows us to pursue cooperation in partnership with leading international companies to implement upstream projects at the largest Rosneft greenfield sites in West and East Siberia.”
BP Russia's head David Campbell said the "agreement and creation of a new joint venture reinforces BP’s commitment to our strategic investment in Russia and our long term partnership with Rosneft. In the current low oil price environment we continue to look for opportunities for future growth.”
BP has committed to provide up to $300mn in two phases as its contribution to the cost of the JV’s activities at the exploration stage. Rosneft will contribute licenses and operational experience in West Siberia and Yenisei-Khatanga with initial drilling to be performed by Rosneft subsidiaries.
Earlier this week Rosneft approved the decision to distribute roubles 124.5bn ($1.9bn) in dividends, which is 43% more than last year and is equal to 35% of Rosneft's IFRS net profit for 2015.
William Powell