Royal Dutch Shell and Russian oil giant Rosneft, has signed a deal to explore possibilities of working together to develop oil fields and market gasoline and other petroleum products worldwide.
The deal seems to help both oil drillers as Rosneft is battling with heavy debt after a series of acquisitions earlier this year, secure a foreign partner to finance greenfield development and Dutch driller seeks to enter back in the Russian soil as it had forced to leave rich oil reserve year before, following months of pressure from state environmental officials. The British-Dutch firm is after new investment opportunities in Russia at a time when its two existing projects — in Sakhalin and Siberia — are close to maturing.
Shell’s chief executive, Jeroen van der Veer, said:
We are committed to developing our business in cooperation with Russian companies across the entire range of the energy business
Shell now has a 27.5 percent stake in Sakhalin-2, which includes the world’s largest liquefied natural gas project. It is expected to start LNG production next year.
Shell win back opportunity to explore in world richest oil reserve after seven month of blockade. The Anglo-Dutch group asserts that company had entered into a broad partnership with Rosneft, the Kremlin-controlled oil giant, to cooperate in oil production and refining projects in the country.
Experts predict that deal will help Shell to increase its presence in the world market as both drillers are eying to develop number of joint projects in Russia and other countries.
Shell is currently developing the Salym onshore oil project and has often spoken of its desire for a third big development in the country. Rosneft, worth an estimated $60 billion, has more than 6.6 billion tonnes of oil reserves on its books.
Shell’s reentry in Russia, kindles the hope for other ouster western oil drillers.
