Rosneft enters Kurdistan Region blocks

ST. PETERSBURG, June 2, 2017 – Rosneft and the Kurdistan Regional Government (KRG) have agreed to deepen their engagement, announcing increased co-operation on exploration and production on Friday.

Signed on the sidelines of the St. Petersburg International Economic Forum, the agreements also cover commerce and logistics. The two parties will further study additional monetisation options for the region’s 700,000-bopd export pipeline, which Rosneft will gain access to.

Finally, Rosneft and the Ministry of Natural Resources entered into production-sharing agreements (PSAs) for five blocks. The Rosneft statement released on Friday did not offer additional details on the PSAs, but said exploration and production co-operation would include “the gas sphere.”

The statement did say, however, that the parties would be working to establish a joint venture “for implementation of the long-term contract related to infrastructure systems in Iraqi Kurdistan.”

“The Company is widening its cooperation with Iraqi Kurdistan across the whole production chain. The crude is being delivered to the German refineries of Rosneft, which is indicative of our successful business diversification strategy,” Rosneft CEO Igor Sechin said of the deal.

In February, Rosneft became the first oil major to enter into a pre-financing agreement with the KRG. Commodity traders have been granting loans secured by future oil exports for some time, but only Glencore has publicly acknowledged such deals.

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