Russia’s Rosneft seeks Azeri gas field stake

Russia’s Rosneft seeks Azeri gas field stake

Russia’s Rosneft seeks Azeri gas field stake

AFP Photo

Russian oil major Rosneft is seeking a stake in Azerbaijan’s Absheron gas project, sources close to the talks said, in the latest move that may help it become a competitor of Russia’s gas exporter Gazprom.
Rosneft CEO Igor Sechin discussed a possible role in Absheron with Azeri President Ilham Aliyev during a visit to Baku this month and has also been in discussions with the project’s leader, France’s Total, the sources said.

Azeri state oil company SOCAR and the French oil company each hold 40 percent of the project to develop Absheron, a shallow-water offshore field on the Caspian Sea, under production-sharing agreements. The remainder is held by GDF Suez .

Exploratory drilling by Total showed the field contained 150 billion to 300 billion cubic metres (bcm) of gas resources. The find was declared commercial in 2012.

Azeri officials have said Absheron and other new fields would significantly increase Azeri gas exports in coming years, beyond the 10 bcm it has already pledged to Europe and 6 bcm it has pledged to Turkey from the giant Shah Deniz field 25 km from Absheron.

These Azeri exports are set to compete with supplies from Gazprom, which holds a monopoly on exports of Russian gas and covers a quarter of Europe’s gas needs through pipelines. For Rosneft, an Azeri deal would be its foreign foray that could put it into direct competition with Gazprom in sales to Europe.

Rival new pipeline projects are being planned to reflect the future competition between Azeri and Russian gas.
For the next 10 years, Azerbaijan is seen as the most secure source of new pipeline gas exports to Europe.