Following the completion of the transaction Total will retain a 20% interest in Kharyaga alongside Zarubezhneft (40%, operator), Statoil (30%) and Nenets Oil Company (10%). The transaction is subject to the approval of the Russian authorities.
“Russia remains a key country for the Group. Total has ambitious plans for the future through its established partnership with Novatek and the ongoing Yamal LNG project”, commented Arnaud Breuillac, President Total Exploration & Production. “This transfer represents a new stage in the life of Kharyaga. A more substantial role for Zarubezhneft alongside our continued involvement will allow us to extract maximum value from Kharyaga for many years to come.”
Sergey Kudryashov, General Director of Zarubezhneft noted: “The deal is of interest to Zarubezhneft given our existing participation in Kharyaga, a field we know very well. Our strategy focuses on the development of fields with difficult reservoirs. Since 2008, our company has been developing fields of similar geological structure under the RUSVIETPETRO joint venture in the Nenets Autonomous Okrug, located some 100 kilometers from the Kharyaga field. We plan to increase cost efficiency at Kharyaga by leveraging this experience and extracting synergies, thereby creating additional value for the project stakeholders and the Russian Federation. This is also a step towards closer cooperation in other projects with our longstanding partner Total.”
The Kharyaga PSA involves the development of objects 2 and 3 of the Kharyaga oil field in the Nenets Autonomous District, with production of 30,000 barrels of oil per day. The project is technically challenging, with complex geology, heterogeneous carbonate reservoirs, waxy oil and a high content of H2S in associated gas. Since its start up in 1999, the project has safely produced a cumulative 15 million tonnes of oil and generated $3 billion for Russia.