Total Focuses Its Russia Business on Novatek After Kharyaga Dealby
Total SA, France’s largest oil and gas producer, will focus its Russian business on ventures with Novatek OJSC after agreeing to reduce its stake in the Kharyaga oil field.
“Total has ambitious plans for the future through its established partnership with Novatek,” Arnaud Breuillac, Total’s president of exploration and production, said Thursday in a statement. The two companies are collaborating on a liquefied natural gas project on the Arctic Yamal Peninsula.
Total agreed to divest half its 40 percent stake in the Kharyaga production sharing agreement, transferring a 20 percent share and the project’s operatorship to Russia’s state-owned OAO Zarubezhneft, according to both companies. The agreement follows Total’s exit from a partnership to explore shale basins with Lukoil PJSC, which was scuppered by sanctions.
Total owns almost 19 percent of Novatek, Russia’s second-largest natural-gas producer, according to data compiled by Bloomberg. As well as the $27 billion Yamal LNG project, the companies are partners in a gas and condensate venture in the Yamalo-Nenets region.
Following the Kharyaga transfer deal, Zarubezhneft will hold a 40 percent stake in the project, Total 20 percent, Statoil ASA 30 percent and Nenets Oil Co. 10 percent.