Gazprom Neft, Mubadala Petroleum and the Russian Direct Investment Fund Establish a Joint Venture for Managing Assets in Western Siberia
Gazprom Neft has signed a binding agreement on the alienation of a 49-percent share in the authorised capital of Gazpromneft-Vostok — the purchasers being Mubadala Petroleum (United Arab Emirates) together with the Russian Direct Investment Fund (RDIF, the sovereign wealth fund of Russia).
The asset-holding structure following the closing of the transaction will be Gazprom Neft 51 percent, Mubadala Petroleum 44 percent, and the RDIF five percent.
Proved and probable hydrocarbons at Gazpromneft-Vostok fields stand at approximately 40 million tonnes (SPE-PRMS, approximately 300 million barrels). Oil production in 2017 totalled 1.6 million tonnes (approximately 33,000 barrels per day (bpd)). The crude produced at the fields is sold on the domestic Russian and international markets, transported primarily through the Eastern Siberia—Pacific Ocean oil pipeline, as well as being sent for processing at Russian refineries.
This project is Mubadala Petroleum’s first investment in the Russian oil and gas sector.
Gazprom Neft CEO Alexander Dyukov commented: “Our company is already experienced in establishing joint ventures with international partners, but this is the first time one of the largest investment funds in the UAE has invested in one of Gazprom Neft’s Russian assets. This transaction is of considerable importance not just for our company, but for the whole industry. The major potential of Gazpromneft-Vostok lies in developing technologies for hydrocarbon exploration and production in pre-Jurassic strata. And it’s also important for us that our partners believed and had confidence in not just the present, but also the future, of this asset. The task of starting the viable and cost-effective development of Paleozoic reserves can be more effectively addressed in partnership, combining our technological and financial resources.”
Kirill Dmitriev, CEO, Russian Direct Investment Fund (RDIF), added: “RDIF and Mubadala Petroleum investment in a joint venture with Gazprom Neft brings the funds, experience and expertise of our Middle East partners to the Russian oil and gas sector. RDIF, Mubadala Petroleum and Gazprom Neft see this project as the first step in creating a consortium to pursue further significant investments in the sector.”
Dr Bakheet Al Katheeri, CEO, Mubadala Petroleum, said: “This investment marks a further step in our long-term growth strategy and sees Mubadala Petroleum’s entry into Russia. Through this new partnership with RDIF and Gazprom Neft, one of Russia’s leading operators, we will not only to share but also further build on our expertise and capabilities in oil and gas while adding significant oil production to our existing oil and gas portfolio.”
