Rosneft-BP JV Hires Turkish Firm for Russian Gas Project
A Rosneft-BP joint venture has hired Turkish construction firm Tekfen to build a new gas pipeline in Western Siberia.
The 90-km pipeline will connect the Kharampurskoye gas field in the Yamalo-Nenets area with Russia’s national grid system, Tekfen said in a statement on January 4. The Turkish firm will finish the pipeline by June 2021 under a contract worth rubles 19.5bn ($316mn).
BP and Rosneft agreed in late 2017 to develop Kharampurskoye and the neighbouring Festivalnoye field, representing one of Rosneft’s largest new gas projects. Rosneft placed their combined resources at the time at 880bn m3.
BP closed the purchase of a 49% stake in Kharampurneftegaz, the Rosneft subsidiary that owns the fields, in April 2018. According to Rosneft’s website, the fields are expected to flow 11bn m3/yr of gas under the first stage of their development, with output potentially reaching 24bn m3/yr at a later point.
Rosneft set out in 2017 to expand its annual gas production to 100bn m3/yr with five years. But the company is currently struggling to keep output stable, let alone achieve growth. Its production fell 1.7% in 2018 to 67.3bn m3, and by a further 0.4% in the first nine months of 2019.
Neither Rosneft nor BP have disclosed a timeframe for initiating production at Kharampurskoye and Festivalnoye. Rosneft had hoped to launch the project as early as 2012, prior to entering talks with BP.
BP is Rosneft's closest international partner. It owns a 19.75% stake in the state oil giant and has a number of upstream joint ventures with the company across Siberia.