Russian majors form JV to explore Caspian Sea

Russian majors Lukoil, Yukos, and Gazprom have agreed to form an equally owned joint venture to explore for hydrocarbons in the Caspian Sea. This represents a great leap forward for Yukos, which is following the example of Lukoil by expanding the geographical scope of its operations. The new venture will prospect for oil and gas in the northern Caspian, the partners said.


MOSCOW�Lukoil, Yukos, and Gazprom have agreed to form a joint venture to explore hydrocarbons in the Caspian Sea. This represents a great leap forward for Yukos, which is following the example of Lukoil by expanding the geographical scope of its operations.

The new venture, which has not yet been named, will prospect for oil and gas in the northern Caspian, the partners said. They noted that equity in the venture would be split equally among the three companies but did not provide any other details.

Two years ago, Yukos lost out to Lukoil in a fight to receive the license granting exploration rights to the northern part of the Caspian Sea. Under this latest agreement, however, Lukoil has now resolved to share the investment risks of exploration with its former rival and with Gazprom.

Earlier this year, Lukoil and the Offshore Kazakhstan International Operating Co. consortium made what appears to be a major oil discovery in the Russian sector of the Caspian on the North Caspian Shelf (OGJ, Apr. 3, 2000, p. 32).

Subsea resources in the northern Caspian are ostensibly split between Russia and Kazakhstan under an intergovernmental agreement signed in 1998, but Kazakhstan officials declared earlier this year, after Lukoil revealed its Severny discovery, that the jurisdiction of certain areas is still unclear.

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