Page 21 - FSUOGM Week 01 2021

FSUOGM PROJECTS & COMPANIES FSUOGM

Rosneft beats Novatek in

Arctic licence contest

RUSSIA RUSSIA’S Rosneft has outbid private rival addition to over 2mn barrels per day (bpd) of oil.
Novatek in a contest for rights to a block in Rus- According to Russian subsoil licensing
Both companies have sia’s far north. agency Rosnedra, the starting price for bids
LNG ambitions in the The state oil major has won a 30-year licence for the Zapadno-Minkhovsky licence was
Arctic. to explore and develop the 1,480-square km RUB124mn ($1.7mn). The agency did not say
Zapadno-Minkhovsky block straddling the how much Rosneft paid, but it did say that the
south-west shore of the Gydan Peninsula. The company beat a rival offer from Novatek, Russia’s
exploration phase runs for 10 years. biggest LNG producer.
Zapadno-Minkhovsky has some 329.5bn Novatek wants to accumulate more gas
cubic metres in DL+D1+D2 gas resources, as reserves on the Gydan Peninsula to underpin
well as 11.8mn tonnes (1.06bn barrels) of con- future LNG export projects, namely the 5mn
densate. But it is scarcely explored. Only 1,068 tpy Obsky LNG and 20mn tpy Arctic LNG-1
km of 2D seismic data has been collected at the developments. It is yet to take a final investment
site and no drilling has taken place. decision (FID) on either plan. Novatek’s aim is to
The block is also remote, with the nearest gas produce 70mn tpy of LNG by 2030.
pipeline located some 150 km to the south-east,
while the nearest oil pipeline is situated 240 km 2021 contest
to the south-east. However, its access to the Taz Russia’s government also announced in late
Bay could enable the export of oil and gas via sea December it would offer up rights to another
in the event of a discovery. Gydan block, Severo-Gydansky. The area con-
Rosneft is looking to establish LNG produc- tains over 1.2 trillion cubic metres in D-category
tion in the Russian Arctic, although its main resources. Novatek CEO Leonid Mikhelson
focus is its Vostok Oil fields located hundreds requested last year that the auction be held. Only
of kilometres east of Zapadno-Minkhovsky in companies that already have licences on either the
the Krasnoyarsk region. Company CEO Igor Gydan or Yamal peninsulas will be able to take
Sechin recently said these fields could produce as part in the contest, the government said, and the
much as 50mn tonnes per year (tpy) of LNG, in extracted gas must be used for LNG production.™

Lukoil lands rights to new Caspian block

RUSSIA RUSSIA’S Lukoil has secured exploration rights Lukoil paid RUB82.6mn ($1.1mn) for the
to a new area in the Russian zone of the Caspian rights, Rosnedra said, without disclosing the
Lukoil's CEO requested Sea. company’s licence obligations.
the licence in a letter to An auction took place on December 24 for a Lukoil entered the Caspian Sea in 1995, and is
Putin in January. licence to the Tyuleniy block, according to sub- the only producer in the Russian zone. It brought
soil licensing agency Rosnedra. The two bidders on stream its first Caspian field in 2010, Kor-
in the contest were both subsidiaries of Lukoil, chagin, followed by the larger Filanovsky deposit
with Lukoil-Nizhnevolzhskneft declared the in 2016. Lukoil reported on December 29 it had
winner. extracted a total of 35mn tonnes (257mn barrels)
The Tyuleniy block covers a section of the from the two fields since their launch.
North Caucasus-Mangyshlak oil and gas basin, The next project due to start flowing is Gray-
under waters 0-20 metres deep near Tyuleniy fer, formerly known as Rakushechnoye, in 2022.
Island. Seismic surveys have identified six poten- The company has several other fields in the
tial hydrocarbon structures at the block. The Russian section, mostly consisting of gas, but
area’s D1 resources are assessed at 25mn tonnes none of them have reached a final investment
(183mn barrels) of oil and 65bn cubic metres of decision (FID). It also controls several undevel-
natural gas. oped deposits off Kazakhstan.
Lukoil CEO Vagit Alekperov reportedly Oil from Lukoil’s Caspian fields is dispatched
wrote to Russian President Vladimir Putin in to markets via the Caspian Pipeline Consor-
January requesting a licence to the Tyuleniy tium (CPC) pipeline, which transports Russian
rea. The company head said Lukoil needed new and Kazakh crude to Novorossiysk, where it is
exploration opportunities in the Caspian, pro- loaded onto tankers. The fields’ gas is less easily
posing that rights be granted without a tender. monetised. Lukoil currently sells some of it to
However, Russia’s Natural Resources Ministry Gazprom and uses the remainder as feedstock
insisted that an auction was necessary. for petrochemical production. ™

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