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Arctic Yearbook 2013
Scramble for the Arctic Offshore Oli & Gas Resources in Russia
its plans to start production in the Prirazlomnaya field in 2013 and the granted tax breaks could save
Gazprom $2.4 billion in expenses (Rbk, 2012).
Following Gazprom‘s stance, Rosneft claims tax reductions from the government for its offshore
Arctic projects that the company wants to develop together with its foreign co-partners. Rosneft has
also performed as an ardent supporter of Gazprom‘s rigid stance on denial of the subsoil legislation
liberalization. As part of their shared interests, the two companies had plans for joint activities on
the continental shelf. Their cooperation in Arctic offshore projects date back to 2002 when Rosneft
and Gazprom established ―Sevmorneftegaz‖ – a joint venture to develop the Shtokman and
Prirazlomnoye fields. In 2005, Rosneft sold its shares to Gazprom in order to release financial room
for further merging with the private oil company Yukos. The Yukos takeover by Rosneft
represented one of the first steps in the oil company becoming the world‘s largest oil producing
company, which Rosneft fulfilled in March 2013 by completing the TNK-BP transaction.
In 2006 Rosneft and Gazprom launched a process for a future offshore deposits division by signing
an agreement on a strategic partnership for the period up to 2015 with a possibility for a five-year
extension. The agreement, in particular, prescribed joint exploration, production, transportation and
processing of hydrocarbons on a fifty-fifty basis. Based on the agreement, the companies intended
to jointly participate in tenders and auctions for subsoil use licenses and to exchange the acquired
geological information. The signed agreement was first and foremost aimed at reducing
confrontation between the two companies and to raise the companies‘ competitiveness on the
internal energy market, since the two companies have been actively fighting for the same licenses,
triggering the initial price increase.
A further step towards division of powers in the energy sector was made in June 2007 when it was
announced by the Ministry of Energy that the Arctic shelf and the Far East shelf would be explored
by Rosneft and Gazprom. The announced measures have been implemented in the amendments to
the Federal Law ―On Subsoil Resources‖ in 2008.
To safeguard their positions in lobbying for an offshore monopoly and to reduce criticism from the
Ministry of Natural Resources and Ecology concerning the low geological survey pace, Gazprom
and Rosneft signed a cooperation agreement in 2012 on the creation and sharing of infrastructure
for offshore deposits development. The agreement prescribed a development of business
partnership between the two companies in order to increase their geological knowledge and to
develop a reproduction of the resource base of the continental shelf.
In March 2013, after receiving licensing approval from the government on offshore deposits
development, Rosneft heavily criticized the Ministry of Natural Recourses and Ecology state
program on continental shelf development, calling its main parameters for geological survey
overestimated and suggesting establishment of a coordinated agency in order to work out a new
document that would encompass the interests of the state-controlled companies. Rosneft also
criticized the provision in which the company was obliged to return licenses to unallocated fund
deposits in cases where the company had no intention to develop the field (Melnikov and
Solodovnikova, 2013).