Russia Unveils New Arctic Oil, Gas Search

Russia’s state mineral exploration agency Rosgeologia has outlined plans for an aggressive new search for oil and gas resources in the Arctic, Moscow business daily Kommersant reports.

The exploration programme, which would run between 2020 and 2045, was proposed by Rosgeologia head Sergey Gorkov in a July 25 meeting of Russia’s state commission for Arctic development, the newspaper stated, citing a copy of his presentation. It would be funded with rubles 292.5bn ($4.6bn) in support from Russia’s sovereign wealth fund and the state budget.

According to Gorkov, finding new Arctic resources would help Russia expand the use of its Northern Sea Route (NSR). Moscow views the Arctic shipping route’s development as a strategic priority, with government officials setting out plans earlier this to expand its cargo trade to 92.6mn mt by 2024, up from 20.2mn mt last year.

The exploration programme would involve geological studies as well as parametric and appraisal drilling. Its first phase between 2020 and 2024 would cost a projected rubles 89.3bn, while the second between 2024 and 2035 would cost rubles 104.6bn. The final stage up until 2045 would require 98.6bn rubles.

Following its recent meeting, the Arctic commission’s head, Deputy Prime Minister Yury Trutnev blasted the work of Russia’s natural resources ministry in developing Arctic reserves as “unsatisfactory”.

“Little money is allocated, and geological exploration is carried out in insufficient quantities; fields are not being developed,” he said.

Earlier efforts had depended on bringing foreign technology, which US sanctions banned in the wake of the 2014 unrest in Ukraine. This brought to a close the Rosneft-ExxonMobil Kara Sea programme later that year after one well had been drilled. Russia is therefore working on developing its own technology, both to cut costs and protect itself from outside threats.

Rosgeologia is subordinate to the natural resources ministry. Gorkov took over as its head in April after his predecessor Roman Panov resigned following the arrest of his deputy on fraud charges.

Source: naturalgasworld.com