Russia thaws relations with $1B Exxon deal
ExxonMobil is to make a new investment in Russia for the first time in more than a decade as Moscow seeks to thaw its frosty investor climate and keep its oil flowing.
Russian state oil company Rosneft will develop more than a billion tonnes of Black Sea oil using a $1-billion investment by U.S.-based ExxonMobil, the biggest privately controlled oil company in the world whose relationship with the world’s top oilproducing country has been poor in the 21st century.
The deal was announced on Thursday in Davos and came just days after Rosneft unveiled an Arctic tie-up and share swap with Britain’s BP.
Russia’s Deputy Prime Minister Igor Sechin, who is also Rosneft’s chairman, signed the deal with Rex Tillerson, chief executive of Exxon, at the World Economic Forum.
Sechin said the deal was proof that the investment climate in Russia had improved. “We have managed to convince even Exxon of that,” he said.
Rosneft officials said Exxon would invest $1 billion, and the deepsea venture would be split 50/50 at the exploration stage, then 66/33 in favour of Rosneft at the development stage.
ExxonMobil has in recent years clashed with Russian authorities over the budget for the Pacific Sakhalin-1 project.
The deal is the second tieup with a major western oil company this year. It follows a shares swap and drilling deal in the Arctic between Rosneft and Britain’s BP.