Russia Monitor is a review of the most important events related to Russian internal and external security, as well as its foreign policies.
Date: 29 November 2022 Author: Grzegorz Kuczyński
Lukoil Becomes Gazprom Neft’s Partner in Joint Venture with Repsol
The Russian energy market is seeing further reshuffles as Western companies quit the country, with domestic firms taking over their assets. Among those Russian companies is Lukoil, a privately run oil producer. Business decisions seem to have a political, rather than a financial background. Russia’s oil giant Lukoil has taken over assets in joint ventures between Western firms and Russian state-run companies.
Since November 23, Meretoyakhaneftegaz, a joint venture between Gazprom Neft and Lukoil created back in February, has been the management company of Evrotek-Yugra, which develops the respective blocks in the Khanty-Mansiysk Autonomous District. Evrotek-Yugra was a joint venture between Gazprom Neft and Spain’s Repsol. The Spanish energy company quit the asset. Gazprom Neft purchased 50 percent of Evrotek-Yugra from Repsol at the end of 2021. Evrotek-Yugra was prospecting and appraisal licenses for the Sverdlovsky, Kileysky, Karabashsky-3, and Karabashsky-9 blocks, respectively; as well as holds two mining licenses for Karabashsky-1 and Karabashsky-2, where the project’s key asset, the Ervie field, formerly Ourinskoye, with recoverable oil reserves of around 34 million tons, is located. Production has not begun, though Gazprom Neft is already preparing for development. Evrotek-Yugra is now a new enterprise among Gazprom Neft’s Russian assets to include Lukoil as a partner. In 2021, Gazprom Neft and Lukoil created the first 50-percent parity joint venture at Meretoyakhaneftegaz to develop the large Tazovskoye field in Yamal. Earlier Lukoil had seized other Western assets in Russia, which were Shell retail stations throughout Russia. The Federal Antimonopoly Service approved the sale of 99.9 percent shares of Shell Neft, the British energy giant’s subsidiary in Russia, to Lukoil. The deal comes with a few caveats purportedly aimed at a fair competition. Some of the conditions are a regular sale of refined products by Lukoil at the commodity exchange and limiting the purchase of refined products to the exchange’s main session оf bidding. Shell Neft owns 411 retail stations that are mainly located in Russia’s Central and Northwestern federal districts, as well as the Torzhok lubricants blending plant in the Twersk region.
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