Russian economy not to be affected by halt in projects with foreign energy cos - Econ Ministry
MOSCOW. Jan 12 (Interfax) - A halt in joint shelf and shale projects between Russian and foreign companies will not have a significant impact on the Russian economy in the medium-term perspective, the Economic Development Ministry said.
The ministry stated its position in a letter to the government as part of preparation for the Gaidar Forum, a source from the economic block of the government told Interfax.
Because of U.S. and EU sanctions against Russia that ban services, technology and goods used for geological exploration and oil production in deepwater, arctic and shale projects, joint energy projects are being suspended. American ExxonMobil has frozen the majority of projects being carried out with Russian oil major Rosneft , including geological exploration and production on the Russian shelf at the Laptev Sea, Black Sea, Chukchi Sea and Kara Sea. This also includes a pilot project to extract tight oil reserves in Western Siberia.
In addition, a joint project between Lukoil and France's Total to develop shale reserves has been suspended. The two companies planned to create a joint venture to work at the Bazhenov Suite. Shell and Gazprom Neft have also stopped working with CJSC Khanty-Mansiisk Oil and Gas Union, which was created to explore and develop shale oil reserves in Khanty-Mansiisk Autonomous District.
The Economic Development Ministry said that all of these projects were in their initial stages, which includes drilling exploration wells, carrying out seismic surveying and drilling production wells. The only project in the most advanced stage of geological exploration was a project between Rosneft and ExxonMobil to drill the Universitetskaya-1 exploration well, the ministry said.
Since projects of the oil and gas sector can be characterized as lengthy - receiving a positive cash flow and bringing projects to provide returns on investments have a significant time lag - moving to the industrial development stage at shelf and shale fields was not planned in the medium-term perspective, the Economic Development Ministry said.
The Gaidar Forum will take place in Moscow on January 14-16. The forum, titled "Russia and the World: The New Vector," will focus on socioeconomic issues. Russian Prime Minister Dmitry Medvedev participated in the forum's plenary session last year.