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Gazprom Neft to Bring Shell Into Shale Oil, Offshore Projects

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April 4 (Bloomberg) -- OAO Gazprom Neft, the oil arm of Russia’s natural gas exporter, plans to expand its partnership with Royal Dutch Shell Plc to develop shale oil in Siberia and Arctic offshore blocks, according to a Kremlin official.

Gazprom Neft and Shell will sign agreements next week during President Vladimir Putin’s visit to the Netherlands, the Kremlin official said, asking not to be identified because talks are continuing. OAO Gazprom, the world’s biggest natural gas producer, will also sign an accord with Nederlandse Gasunie NV, the official said without elaborating.

Putin is overseeing ventures with international oil explorers to help tap billions of barrels of unconventional oil resources in Russia and maintain output at more than 10 million barrels a day, a post-Soviet record. Gazprom Neft and Shell have begun exploring for tight oil in Siberia within their Salym Petroleum Development project, while state-run competitor OAO Rosneft has brought in Exxon Mobil Corp., Statoil ASA and Eni SpA to develop shale and offshore projects.

Putin is leading a business delegation to the Netherlands April 8 that includes billionaires Viktor Vekselberg and Vladimir Evtushenkov and businessman Ziyavudin Magomedov, whose Summa Group is building an oil terminal in Rotterdam, as well as Gazprom Neft Chief Executive Officer Alexander Dyukov, Gazprom CEO Alexei Miller and OAO Lukoil CEO Vagit Alekperov, according to the Kremlin.

Gazprom Neft is seeking to operate exploration licenses for its parent company in the Kara, Pechora and Chukotka Seas and to begin exploration drilling at the offshore Dolginskoye deposit this year, Deputy Chief Executive Vadim Yakovlev said Feb. 26.

Julia Dudley, a spokeswoman at Shell, declined to comment. Gazprom Neft didn’t immediately comment by phone.

To contact the reporters on this story: Olga Tanas in Moscow at otanas@bloomberg.net; Stephen Bierman in Moscow at sbierman1@bloomberg.net

To contact the editor responsible for this story: Balazs Penz at bpenz@bloomberg.net

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