Putin pushes Rosneft and Exxon Mobil to expand cooperation outside Russia

By bne IntelliNews July 16, 2013

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Russian President Vladimir Putin on July 16 called on state-controlled oil giant Rosneft to expand its cooperation with US energy major Exxon Mobil to push projects outside Russia.

Under a strategic framework sealed in 2011, the pair has recently agreed joint ventures to explore Russian deposits in the Black Sea and the Arctic shelf. However, Putin is keen to seen Rosneft stretch its wings to become an international investor. To that end, he pushed the companies to start on projects in the US, in particular the Gulf of Mexico, as was also set out in the framework.

"On both the Black Sea and the shelf a lot is to be done, and I am happy that Exxon Mobil is becoming a strategic partner of our largest company: Rosneft," Putin said during a video-conference with Rosneft CEO Igor Sechin and Exxon Mobil Development President Neil Duffin, according to Ria Novosti. "I expect that Rosneft will work with Exxon Mobil in other regions of the world, including in the Gulf of Mexico and the US."

Rosneft sealed 2011 Strategic Cooperation Agreement after its earlier attempt to conclude a $15bn tie up with BP was wrecked by the group of Russian oligarchs that own the TNK-BP JV with the British major. The framework saw the Russian company gain 30% stakes in three projects in North America: a tight oil project in Texas, 20 deepwater blocks in the Gulf of Mexico, and a shale oil concession in Canada.

However, the bulk of the action has been taking place in Russia, as the pair bid to develop the country's huge - but challenging - reserves in hostile offshore environments. In June, they sealed JV agreements to explore the Black and Kara Seas, and set the foundations to establish vehicles to explore seven other licenses in the Russian Arctic, as well as to manage a West Siberian tight oil project. The companies also agreed to move to the next planning phase for an LNG development in the Russian Far East, and to build an Arctic research centre.

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