Page 17 - FSUOGM Week 23

FSUOGM PROJECT & COMPANIES FSUOGM

Rosneft eyes Arctic gas fields

RUSSIA RUSSIA’S largest oil company Rosneft is asking As reported by bne IntelliNews, in October
the government to auctions three new Arctic last year the Russian government agreed to pro-
Vostok Oil is mainly gas fields, as it looks to add gas resources to its vide Vostok Oil with a RUB600bn ($9bn) break
oil-focused. Vostok Oil megaproject, RBC business portal on the mineral extraction tax (MET), but the
reported on June 3. project could see investments cut as Rosneft
Rosneft CEO Igor Sechin made the request scales back its capital expenditure programme.
in a letter to Russian Prime Minister Mikhail The fields Rosneft is seeking – Ushakovskoye,
Mishustin, seen by RBC. He proposed that auc- Deryabinskoye and Kazantsevskoye – would
tion terms limit participants to those that already boost Vostok Oil’s gas resources from 0.5 to 2.0
have production assets in northern Krasnoyarsk. trillion cubic metres. The deposits are located
Rosneft would be the only firm that fits this far from Russia’s gas pipeline system, but Ros-
criteria. neft reportedly is proposing to transport gas in
Vostok Oil was unveiled by Sechin last year, tankers in LNG form via the Arctic Northern
with the CEO claiming that the project could one Sea Route. Rosneft is a shareholder in the Zvezda
day flow up to 2mn barrels per day (bpd) of oil. It shipyard in the Far East that is building these
comprises the Vankor fields owned by Rosneft, tankers.
the Paiyakhsky fields operated by private firm Rosneft has not had much success in the LNG
Neftegazholding, controlled by former Rosneft sphere. It has tried to advance several projects in
president Eduard Khudainatov, and a field run the Arctic and the Far East but none of them
by Rosneft-BP joint venture Yermak-Neftegaz. reached a final investment decision. ™

Gazprom Neft makes progress

at Bazhenov

RUSSIA GAZPROM Neft is preparing to launch devel- Russia has long sought to try to replicate
opment of the Bazhenov tight oil formation in the success of tight oil development in the US.
Gazprom Neft has sunk Western Siberia, it announced on June 3. Bazhenov underlies most of Western Siberia’s
its first exploration The company said in a statement it had conventional reservoirs and is estimated to con-
and appraisal well at a completed a 3D-seismic survey at the Salym- tain up to 75bn barrels of technically recovera-
Bazhenov site. sky-3 block, where it is targeting the forma- ble crude, according to the US EIA. This is more
tion, and would finish interpreting the data by than there is in all the tight oil formations in the
the end of the year. The results will be used to US put together.
upgrade Gazprom Neft’s geological model of Russian producers began reaching out to
the play. international partners to help develop Bazhe-
Gazprom Neft has also sunk its first explo- nov sites in 2012, with Gazprom Neft teamed up
ration and appraisal well at the site, measuring with Royal Dutch Shell. However, these partners
1 km in depth excluding its horizontal section, pulled out after the US and EU imposed sanc-
it said. More than 300 core samples have been tions prohibiting them from assisting at uncon-
taken and preliminary results indicate the pres- ventional Russian oil projects, in response to
ence of hydrocarbons at six intervals in the Moscow’s annexation of Crimea.
layer, confirming the potential for commercial After sanctions were introduced, Gazprom
development. Neft sought to develop Bazhenov on its own,
Gazrpom Neft estimates in-place Bazhenov setting up a special centre to research the play.
tight oil at Salymsky-3 and the neighbouring Its efforts have yielded some results, with the
Salymsky-5 blocks at over 500mn tonnes (3.67bn company announcing in March it had almost
barrels). Commercial oil flow is expected to start halved the projected cost of producing oil from
in 2025. Bazhenov to RUB16,000 ($216) per tonne or
“Developing the Bazhenov formation is a $29.5 per barrel.
task of national importance and scale,” Gazprom When taking into account transport and
Neft’s director for technological development, other costs, though, developing Bazhenov would
Alexei Vashkevich, said in a statement. “These not be feasible at the current low prices. Gaz-
complex deposits are marked by their colossal prom Neft’s development plans therefore hinge
resource potential, and high-quality oil.” on a meaningful market recovery. ™

Week 23 10•June•2020 www. NEWSBASE .com P17