Exxon, Russian firm to partner on energey projects
BY Associated Press
Tuesday, April 17, 2012
4/17/12 at 6:53 AM
NEW YORK (AP) - Exxon Mobil Corp. is teaming up with Russian oil giant OAO Rosneft to develop oil and natural gas fields in Russia and North America.
The deal is a major score for Exxon, granting the Irving, Texas-based company access to some of the world's richest sources of crude oil and other hydrocarbons in the Black Sea and the Russian Arctic. In turn, Rosneft subsidiaries will take ownership stakes in three Exxon projects in the U.S. and Canada.
The companies agreed in August to form a partnership. They announced new details Monday in conjunction with a signing ceremony in Russia that was held at Russian Prime Minister Vladimir Putin's suburban residence.
As part of the agreement, Exxon will work with Rosneft to develop Russia's prized offshore reserves in the Black and Kara seas. Rosneft does not have its own technology for deep sea drilling, so it needed a partner to develop the offshore projects. Exxon already has experience drilling in the Arctic regions of Canada.
Exploration already has started in the region, and the companies said that the first test wells could be drilled in 2014. Exxon and Rosneft said initial work in the region will cost about $3.2 billion.
Exploring the Arctic will be difficult and expensive. Russia's First Deputy Prime Minister Igor Sechin said the two companies plan to invest a total of $200-300 billion on projects in the Kara Sea and another $55 billion in the Black Sea, Russian news agencies reported.
The agreements follow Russia's move to reform its tax system to make oil production more profitable for the industry.
Shares of Exxon Mobil Corp. added $1.06 to finish at $84.01.
Original Print Headline: Exxon signs deal with Russian firm
Exxon Mobil Corp. CEO Rex Tillerson (left) shakes hands with Russian Prime Minister Vladimir Putin on Monday. Exxon is teaming with Russian oil giant OAO Rosneft to develop oil and natural gas fields in Russia and North America. ALEXEI NIKOLSKY / Associated Press