Gazprom, Shell to join forces in Russian Arctic

Gazprom, Shell to join forces in Russian Arctic

Gazprom, Shell to join forces in Russian Arctic

Energy giants Gazprom and Shell have agreed to jointly develop offshore Arctic oil fields, which is believed to hold substantial amount of recources.

Russia’s gas monopoly Gazprom and the Anglo-Dutch energy giant Royal Dutch Shell have signed a tentative deal to develop hydrocarbons in the Russian Arctic.

The deal was signed on April 8 by Gazprom CEO Alexei Miller and Jorma Ollila, chairman of the Royal Dutch Shell board of directors, following negotiations between Russian President Vladimir Putin and Dutch Prime Minister Mark Rutte in Amsterdam, reported by Russian state news agency Ria Novosti.

The head of Gazprom said at the signing ceremony that “the deal was a framework agreement that envisaged cooperation in the Arctic as a whole, and that it did not refer to any specific hydrocarbon deposits.”

Under existing rules, only Russian companies with over 50-percent state ownership and no less than five years’ experience working in marine exploration are allowed to develop the Russian continental shelf, said Ria Novosti, noting that only Rosneft and Gazprom currently meet these requirements.

Shell also signed a memorandum with Gazprom Neft, Gazprom’s oil arm, on cooperation in exploring and producing shale oil in Russia.