Rosneft, Alltech in Nenets gas venture
MOSCOW, December 31, 2015 – Russia’s Rosneft and private Alltech Group signed a joint venture agreement last week for gas production and sale in the oil-rich Nenets Autonomous District in Russia. The venture obtained licences to produce from the Kumzhinskoye and Korovinskoye fields, which have total recoverable reserves of 165 bcm (5.83 tcf).
The agreement has been in the works since May 2014. Alltech Group had planned to launch the Pechora LNG project for the fields, but it was cancelled due to LNG export restrictions for state companies, which were put in place by Russia’s Parliament in late 2013 to prevent monopolisation of the gas industry.
The two companies said in a statement that the joint venture would commission a gas-processing centre for output from the fields. The joint venture announcement comes at a time when Russia’s gas production has declined to an all-time low of 414 bcm (14.6 tcf) this year amid slow demand and a drop in upstream investments.