The venture will be based on the Taas Yuriakh unit, which Rosneft gained full ownership of this month, the Moscow-based company said in an e-mailed statement, after signing a memorandum of understanding with CNPC. Output at the unit is forecast to reach 6 million metric tons in 2016, or 120,000 barrels a day, from about 1 million tons this year, according to a March presentation.
China is set to become Russia’s largest oil export market after Rosneft and CNPC signed a $270 billion, 25-year supply deal in the presence of Russian President Vladimir Putin in St. Petersburg in June. China agreed to make advance payments, helping Rosneft repay debt raised in its $55 billion acquisition of BP Plc (BP/)’s Russian venture TNK-BP this year.
“The agreements reached prove once again that Rosneft has a sufficient resource base to meet its strategic goals,” Rosneft Chief Executive Officer Igor Sechin said in the statement. “The participation of our long-term partner in exploration and production activities will help speed up the start of production at Taas and will facilitate the expansion of cooperation with CNPC in other areas.”
The Taas Yuriakh unit’s Srednebotuobinsk field will supply crude to Rosneft’s Komsomolsk refinery and the planned Far Eastern Petrochemical Company, according to the statement. It will also provide exports to China and other Asia-Pacific markets, Rosneft and CNPC said in separate statements.
The East Siberian field also holds 155 billion cubic meters of natural gas resources, according to the statement. Taas can produce as much as 5 billion cubic meters of gas a year, the unit said in December. The deposit neighbors the vast Chayanda deposit controlled by the state-run gas pipeline and export monopoly, OAO Gazprom. The government has approved gas shipments from Taas through the regional network, Rosneft said.
Rosneft announced that it consolidated 100 percent of Tass Yuriakh for an undisclosed price on Oct. 15. Rosneft initially acquired a 35 percent share of the unit from Sberbank for $444 million in 2012.
To contact the reporter on this story: Stephen Bierman in Moscow at email@example.com