Email
Password
Remember meForgot password?
    Log in with Twitter

article imageExxonMobil ignores sanctions to drill in Arctic with Russia

By Karen Graham     Aug 9, 2014 in Business
ExxonMobil and Rosneft, Russia's state-owned oil company commenced drilling operations on Saturday in the Kara Sea with a video conference call from Russian President Vladimir Putin from his residence in Sochi on the Black Sea.
The $700 million project is just one of the joint Arctic development projects of four sea shelf deposits off the northern shores of Siberia between U.S. based ExxonMobil and Rosneft. The Itar-Tass News agency is calling the venture "the world's most ambitious project."
U.S. sanctions over the Ukraine crisis are not intended to stop joint ventures by Russian and U.S. companies, although they are designed to starve Rosneft of capital and ban access to modern technology. How the ban will affect the drilling operation remains to be seen, because ExxonMobil is not under any sanctions.
Igor Sechin, the president of Rosneft said on Saturday, “This is the most ambitious projects in the world’s oil and gas industry. As part of that, today we have started drilling in the Kara Sea. As we said, this is the biggest such offshore project in the world." Geological surveys by the two companies show this will be a highly profitable undertaking, according to Sechin.
“This project will undoubtedly both open new horizons for the Russian Federation and improve energy security globally… we can say that this project is comparable, in terms of reserves, with those in Saudi Arabia and by far exceeds the offshore potential in the Gulf of Mexico, Alaska and Canada,” Sechin said.
Vladimir Putin gave the start order with a video conference call to Sechin and ExxonMobil Russia CEO Glenn Waller who were both present at the Kara Sea location. Putin said the project was "unique in many ways" and will "use the latest technologies". He also pointed out that special environmental measures had been put in place for the protection of the environment.
"I know that Rosneft and all of its partners, including ExxonMobil, attach special significance and pay great attention to this aspect, especially in this part of the world with its sensitive ecology,” Putin said.
Putin pointed to the need for international cooperation in making the project successful, saying “In spite of the difficult current political situation, pragmatism and common sense still have the upper hand, and that is very gratifying. In our opinion, this is a truly responsible, business-like approach, and only such an approach can be productive. We certainly welcome this position and, in turn, are open to expanding our cooperation with partners,” the president said.
The Universitetskaya-1 site is the northernmost oil rig in Russia. Drilling at the site will take place when the Kara Sea is free of ice, from August through late October. ExxonMobil brought the West Alpha rig from Norway. It was provided by North Atlantic Drilling, who signed long-term agreements with Rosneft on July 30.
The 30,700 ton rig was towed 1,900 miles to its site in the East Prinovozemelskiy-1 License Area in the Kara Sea. Held to the sea floor with an eight-anchoring system, the rig was upgraded over a period of two months before it was ready for operation.
More about Exxonmobil, Rosneft, Kara Sea, Vladimir putin, International cooperation
More news from
Latest News
Top News