BP to pay Rosneft $750 million for 20% stake in Siberia oilfield
By Bloomberg
BP Plc agreed to pay Russian partner OAO Rosneft $750 million for a stake in an East Siberian oil producer.
BP will take 20 percent stake in Taas-Yuriakh Neftegazodobycha LLC in Russia’s Far East, according to a deal signed at the St. Petersburg International Economic Forum on Friday. The Taas-Yuriakh unit holds licenses for conventional oil and gas deposits.
The companies also agreed to jointly explore areas in Siberia and, if successful, form a venture with Rosneft holding 51 percent.
BP reset its Russia strategy two years ago when it swapped its half in TNK-BP for cash and a 20 percent stake in state-run Rosneft, which faces U.S.-led financial sanctions. BP’s agreement for the Siberian oilfields follows Royal Dutch Shell Plc’s agreement with OAO Gazprom on Thursday to go ahead with the expansion of a gas export project in Sakhalin.
While U.S. and European sanctions on Russia for its conflict over Ukraine restrict Rosneft from borrowing internationally and limits its access to offshore and shale technology, it doesn’t prevent it from selling assets.
Output from the Siberian fields, located near a pipeline to the Pacific coast, will be used to supply Russian far-eastern refineries and China, according to a statement on Rosneft’s website. Production will increase fivefold to 100,000 barrels a day in 2017 from current levels.
The unit also holds 155 billion cubic meters of natural gas reserves, according to the website.
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