Rus­sia’s Ros­neft Oil & Gas Field to Com­mence Pro­duc­tion this Year

OIL, IOC & Bharat Petrore­sources signed pre­lim­i­nary pact with Ros­neft last month

The Economic Times - - Economy & Companies - San­jeev.Choud­hary@ times­group.com

Vankor, Rus­sia: Ros­neft’s Suzun­skoye field, part of the Vankor clus­ter in Rus­sia where In­dian state firms are in talks to buy stake, will start pro­duc­ing this year.

Oil In­dia (OIL), In­dian Oil (IOC) and Bharat Petrore­sources signed a pre­lim­i­nary agree­ment with Ros­neft last month for a po­ten­tial part­ner­ship to de­velop the Suzun­skoye, Tag­ul­skoye and Lodochnoye fields lo­cated close to al­ready-pro­duc­ing Vankor oil and gas field in the Siberian re­gion.

Energy-hun­gry In­dia has been in talks with sanc­tions-hit Rus­sia to stitch mul­ti­ple deals that can help secure oil and gas sup­plies for the coun­try at a time oil prices have col­lapsed, mak­ing as­sets cheaper and read­ily avail­able. The In­dian state firms, nudged by the gov­ern­ment, have been seek­ing to pro­duce as­sets that come with lower risk for the buyer.

Suzun­skoye, with an ini­tial re­cov­er­able re­serve of 286 mil­lion met­ric tonne (mmt), will ini­ti­ate pro­duc­tion in 2016 while Tag­ul­skoye will take a few more years, a com­pany spokesper­son said. The op­er­a­tional drilling has just started at the Tag­ul­skoye field that has an ini­tial re­cov­er­able re­serve of 56 mmt, the spokesper­son said. The com­pany ex­pects to build 39 well pads and 506 wells as part of the over­all drilling project. The ini­tial re­cov­er­able re­serve at Lodochnoye field is 73 mmt. This field is sev­eral years away from pro­duc­tion.

By com­par­i­son, the pro­duc­ing field of Vankor, where In­dian state firms are in talks to buy nearly half the equity stake, has an ini­tial re­cov­er­able re­serve of 476 mmt. In 2015, Vankor pro­duced 22 mmt of oil and 9.75 bil­lion cu­bic me­ters of gas.

Ros­neft aims to lever­age the ex­ist­ing in­fra­struc­ture at Vankor to process and trans­port oil and gas from the three new neigh­bour­ing fields. A 99-km pipe­line has al­ready been laid to carry oil from Suzun­skoye to Vankor. Ros­neft also plans to build a 65-km pipe­line to evac­u­ate gas from Tag­ul­skoye field to Vankor. Oil and Nat­u­ral Gas Corp (ONGC) has pur­chased a 15% stake in Vankor and is in talks with Ros­neft to raise it to 26%. The con­sor­tium of Oil In­dia, In­dian Oil and Bharat Petrore­sources have also en­tered into an ini­tial agree­ment to buy 23.9% stake that will take the com­bined In­dian stake to 49.9% in Vankor. (The au­thor was in Rus­sia at the in

vi­ta­tion of Ros­neft.)

ONGC has pur­chased a 15% stake in Vankor and is in talks with Ros­neft to raise it to 26%

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