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Naftogaz Ukrainy, US’ Halliburton sign agreement on cooperation

September 29, 2011, 16:01 UTC+3

The parties also signed a preliminary agreement on cooperation between Naftogaz Ukrainy and ExxonMobil’s sub-company to develop unconventional gas

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KIEV, September 29 (Itar-Tass) — Naftogaz Ukrainy and Halliburton of the United States signed an agreement on cooperation on Thursday.

The agreement on building and developing oil fields was signed at the Ukrainian Ministry of Energy and Coal Mining Industry. According to Naftogaz Ukrainy deputy chairman of the board Vadim Chuprun, the parties intend to cooperate “in maintenance, monitoring, service, building and developing oil and gas fields”.

The parties also signed a preliminary agreement on cooperation between Naftogaz Ukrainy and ExxonMobil’s sub-company to develop unconventional gas (shale-gas and methane-gas).

Meanwhile, in August Rosneft and ExxonMobil signed a strategic cooperation agreement in the presence of Prime Minister Vladimir Putin.

Rosneft CEO Eduard Khudaynatov and ExxonMobil Development President Neil Duffin signed the document.

ExxonMobil Chairman and CEO Rex Tillerson, Deputy Prime Minister Igor Sechin and members of the Rosneft Board of Directors attended the meeting.

“Rosneft and a world leader, ExxonMobil, have agreed on the joint work and signed a strategic partnership agreement,” Putin said. “Their joint work will be interesting and extensive. The world energy market will positively respond to the project, because it will open new horizons for operation of world leading companies on the Russian Arctic shelf and in deepwater sectors,” he said.

“Direct investments may amount from 200 billion U.S. dollars to 300 billion U.S. dollars. Together with investments in the infrastructure, the total spending may reach 500 billion U.S. dollars,” he said.

Rosneft will have an access to ExxonMobil fields in the Gulf of Mexico and Texas, Putin said.

“The project opens up broad vistas for Rosneft. In addition, Rosneft will take part in joint projects in third countries,” he noted.

Apart from joint works on the shelf, the agreement stipulates the establishment of a centre for Arctic research, personnel training and interaction with fiscal institutions. “The Russian government will assist this work,” Putin said.

Rosneft and ExxonMobil agreed on the joint development of hydrocarbons on the Russian Black Sea shelf on January 27, 2011.

They will start with geological survey and production of oil on the Tuapsinsky Progib field. The deepwater shelf sector with an area of 11,200 square kilometres stretches along the Black Sea coast in the Russian Krasnodar territory. The sides said they would establish a company to operate the project. Geological survey will cost up to one billion U.S. dollars. Rosneft will have 66.7 percent in the joint venture, while the stake of ExxonMobil will reach 33.3 percent. It was agreed to coordinate final details of the project before the end of this year.

Rosneft and ExxonMobil also cooperate in the Sakhalin-1 project on the Sea of Okhotsk shelf. That is the first large-scale shelf project Russia is implementing on production sharing terms. The agreement was signed in 1996. ExxonMobil has 30% in the project, Rosneft has 20 percent, Japanese Sodeco has 30 percent, and Indian ONGC has 20 percent.

ExxonMobil said that the agreement implied the investment of about 3.2 billion U.S. dollars in geological survey and development of three licensed fields of Rosneft – East Prinovozemelskiy Blocks 1, 2 and 3 in the Kara Sea and the Tuapse License Block in the Black Sea, which are among the most promising and least explored offshore areas globally, with high potential for liquids and gas.

“The agreement also provides Rosneft with an opportunity to gain equity interest in a number of ExxonMobil’s exploration opportunities in North America, including deep-water Gulf of Mexico and tight oil fields in Texas (USA), as well as additional opportunities in other countries. The companies have also agreed to conduct a joint study of developing tight oil resources in Western Siberia,” the ExxonMobil press release said.

“The companies will create an Arctic Research and Design Center for Offshore Developments in St. Petersburg, which will be staffed by Rosneft and ExxonMobil employees. The center will use proprietary ExxonMobil and Rosneft technology and will develop new technology to support the joint Arctic projects, including drilling, production and ice-class drilling platforms, as well as other Rosneft projects,” the press release said.

ExxonMobil Development Company President Neil Duffin said: "Today's agreement with Rosneft builds on our 15-year successful relationship in the Sakhalin-1 project. Our technology, innovation and project execution capabilities will complement Rosneft’s strengths and experience, especially in the area of understanding the future of Russian shelf development.”


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