Rosneft and its subsidiary Val Shatskogo have signed an agreement with Eni Energy Russia B.V. to finance geological works at three offshore Russian license blocks: the Fedynsky and Central Barents blocks in the Barents Sea and the Western Chernomorsky block in the Black Sea.

Under the agreement, Eni will fully finance geological works stipulated in license obligations. Expenses for geological exploration outside of the license obligations will be split between the Companies in line with their stakes in the projects (Eni – 33.33%, Rosneft – 66.67%). Additionally, Eni will compensate the majority of historical costs on completed geological works at the Russian offshore blocks. Eni’s investment will be returned from project cash flows once production is launched at any of the blocks. Rosneft will not be obliged to return the investment if production does not begin.

As was previously announced, on 21 June 2012, Rosneft and Eni concluded a number of agreements to create joint ventures for Russian offshore projects. This was the first step to practically implement their April 2012 cooperation agreement.

Notes for editors

Licensing obligations stipulate that the following works must be completed:

• At the Fedynsky block: 6,500 kilometres of 2D seismic, 1,000 square kilometres of 3D seismic and the drilling of one wildcat and one exploration well;
• At the Central Barents block: 3,200 kilometres of 2D seismic, 1,000 square kilometres of 3D seismic and the drilling of one wildcat and one exploration well;
• At the Western Chernomorsky block: 2D seismic and 2,000 square kilometres of 3D seismic and the drilling of two prospecting and appraisal wells.

Prospective recoverable resources at the Fedynsky and Central Barents license blocks are 2 billion tonnes of oil and 1.9 trillion cubic metres of gas.

Estimated recoverable resources at the Western Chernomorsky block stand at 1.36 billion tonnes of oil. 2D and 3D seismic was carried out at the license block in 2004-2011 (4,495 linear kilometres and 3,319 square kilometres respectively).