RUSSIA'S ARCTIC O&G DEVELOPMENT

ENERDATA - 23 Jul 2020 - Gazprom Neft and Shell have signed a joint venture (JV) agreement to study and develop the Leskinsky and Pukhutsyayakhsky license blocks on the Gydan Peninsula in the Russian Arctic. Each partner will have a 50% stake in the JV, and the transaction is expected to close in 2020 after receiving the necessary regulatory and corporate approvals. The license blocks are estimated to hold over 135 Mtoe, including over 100 Mtoe in the Leskinsky license block located in the Taymyr district of the Krasnoyarsk Krai and 35 Mtoe in the the Pukhutsyayakhsky block located in the Tazovsky district of the Yamal-Nenets Autonomous Okrug. Gazprom Neft has completed 2D seismic surveys on both blocks and plans to drill the first prospecting well in the Leskinsky area in late 2020.

Gazprom Neft has been long collaborating with Shell. In late March 2020, partners agreed to develop the Salym group of oil fields, including the Zapadno-Salymskoye, Verkhnesalymskoye and Vadelipskoye blocks in the Khanty-Mansi Autonomous Okrug. In April 2020, Shell withdrew from a proposed 50-50 JV with Gazprom Neft to develop license blocks in the Yamal-Nenets Autonomous Okrug, due to the fall in oil prices and the coronavirus epidemic. As part a preliminary agreement deal signed in June 2019, Shell was supposed to acquire a 50% stake in the share capital of Meretoyakha Neftegaz, which holds licensing rights to the Meretoyakhinskoye field, along with license blocks at various stages of development, namely the Tazovsky and Severo-Sambrugsky blocks, and two Zapadno-Yubileiny blocks in the Yamalo-Nenets area. The JV, Meretoyakha Neftegaz, would have overseen upstream assets with more than 8 Gbl of oil resources (around 1.1 Gt of oil). Gazprom Neft will continue developing those license blocks independently, according to the previously approved work plan. Development and commercial production at the Tazovsky field is expected to start by the end of 2020.

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