Rosneft, ExxonMobil in venture to develop Black Sea resources

Eric Watkins
OGJ Oil Diplomacy Editor

LOS ANGELES, Feb. 11 -- ExxonMobil Corp. and Russia’s state-owned OAO Rosneft have reached an agreement concerning joint development of oil and gas resources in the Black Sea, to include an initial focus on oil exploration and production in the Tuapse Trough in the Russian Black Sea basin.

"ExxonMobil technologies will effectively complement Rosneft's experience and resources,” said Russia’s deputy prime minister Igor Sechin, who added, “Development of this area will become the springboard for full-scale Black Sea basin development.”

ExxonMobil Chairman and Chief Executive Officer Rex W. Tillerson welcomed the opportunity, saying, "ExxonMobil will bring its technology, project execution capabilities, and innovation to compliment Rosneft’s strengths and experience in the region.”

Tillerson added, “We will build on the successful relationship we have with Rosneft through the Sakhalin-1 project to help meet energy needs in Russia and the wider Black Sea area.”

Under the agreement, the two firms contemplate a joint operating company to conduct exploration and production in the Tuapse Trough, an 11,200-sq-km deepwater area along the Black Sea coast of the Krasnodar region.

The agreement enables the two firms to consider additional opportunities to expand Black Sea energy sector cooperation, including additional exploration and production.

The two sides may also cooperate on oil sales to Rosneft’s Tuapsinsky refinery and other Black Sea markets, development of regional transportation infrastructure, and deepwater technology research and development.

Analyst IHS Global Insight said that for ExxonMobil, “the Rosneft agreement marks a greater commitment to Russia as well as the Black Sea, where the company also has secured acreage and a commitment to explore offshore Turkey and Romania.”

Last March, ExxonMobil Exploration & Production Turkey BV plans to explore off Turkey next year with Deepwater Champion, a Transocean Ltd. drillship.

The Hyundai Heavy Industries shipyard in Ulsan, South Korea, is building the ship, expected to drill in the Turkish Black Sea during the first half 2011 (OGJ Online, Mar. 19, 2010).

ExxonMobil is the second company in weeks to sign a major offshore oil exploration agreement with Rosneft.

Previously, BP PLC and Rosneft agreed to explore and develop the EPNZ 1, 2, and 3 blocks in the underexplored South Kara Sea basin in relatively shallow water on the Russian Arctic continental shelf (OGJ Online, Jan. 24, 2010).

Contact Eric Watkins at hippalus@yahoo.com.

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