Russia to allow private firms to develop offshore

Russia offshore

Russia's natural resources ministry will offer offshore oil and gas licenses to private companies for the first time. Until now, only state-controlled companies are granted access to drill in the Arctic shelf, Dow Jones reported. Non-state developers, however - like OAO Lukoil Holdings, the No. 2 crude oil producer in Russia - have been pushing for offshore licensing rights.

Natural Minister Sergei Donskoi recently announced after a meeting of government ministers that private companies with sufficient experience may be able to receive licenses to blocks in Russia's Arctic shelf, the article stated.

The Moscow Times reported private firms could receive licenses for as much as 20 percent of the Arctic shelf, an environmentally sensitive area. Gazprom and Rosneft are the companies that currently have exclusive rights to the offshore area, which is estimated to contain 98.7 billion tons of oil and gas. Gazprom is the sole major energy company that is against allowing private firms into the offshore drilling area, the article stated.

"Gazprom is categorically opposed [to allowing the participation of private companies]," said the head of Gazprom Alexei Miller, the article stated. "We don't see an answer to the question of why this is necessary."

PennEnergy's research area offers details on oil exploration in Russia.

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