Repsol YPF SA (REP) may seek to boost its presence in Russia via its venture with Alliance Oil Co. after the Spanish crude producer lost assets in Argentina, according to the head of the Russian company.
“There is a lot of interest and a lot of joint work to look for new assets in Russia,” Alliance Oil Managing Director Arsen Idrisov said on a conference call today. “It might be a positive for the Russian market because this was considered as an alternative to Latin American operations of Repsol.”
Repsol executives are revising the Madrid-based oil producer’s long-term strategy after the Argentine government seized its YPF unit last month. The company is looking to boost oil production and identify new petrochemical deposits to offset the loss of its Argentine assets.
Repsol isn’t commenting on its strategy ahead of a May 29 presentation for investors, said spokesman Kristian Rix.
“The question is will Repsol be able to do that in terms of cash available for investments,” Alexander Nazarov, an oil and gas analyst at OAO Gazprombank, said today by e-mail.
Alliance Oil, listed in Stockholm, and Repsol agreed in December to form a $840 million oil and gas venture focused on production in Russia. Repsol owns a minority stake in Alliance after the 2008 merger of Alliance and West Siberian Resources Ltd., in which Repsol had held 10 percent.
“It’s an unfortunate event for Repsol,” Idrisov said. “For us it is rather a support because Repsol has confirmed two strategic areas for investing into the upstream, North America and Russia.”