The East-Prinovozemelsky field (also referred as Vostochno-Prinovozemelskoye structure – meaning: East of Novaya Zemlya structure) is a gigantic undeveloped Arctic oil and gas field located in the South Kara basin of the

continental shelf of Russia The continental shelf of Russia (also called the Russian continental shelf or the Arctic shelf in the Arctic region) is a continental shelf adjacent to the Russian Federation. Geologically, the extent of the shelf is defined as the entirety of the ...

, in the South Kara Sea between the

Yamal Peninsula The Yamal Peninsula (russian: полуостров Ямал, poluostrov Yamal) is located in the Yamalo-Nenets Autonomous Okrug of northwest Siberia, Russia. It extends roughly 700 km (435 mi) and is bordered principally by the Kara ...

and

Novaya Zemlya Novaya Zemlya (, also , ; rus, Но́вая Земля́, p=ˈnovəjə zʲɪmˈlʲa, ) is an archipelago in northern Russia. It is situated in the Arctic Ocean, in the extreme northeast of Europe, with Cape Flissingsky, on the northern island, ...

island. It is the continuation of the continental West Siberian hydrocarbon province.

History

The field is divided into three license blocks: EPNZ-1, EPNZ2, and ENPZ-3. In October 2010, licenses for all three blocks were awarded to Russian oil company

Rosneft PJSC Rosneft Oil Company ( stylized as ROSNEFT) is a Russian integrated energy company headquartered in Moscow. Rosneft specializes in the exploration, extraction, production, refining, transport, and sale of petroleum, natural gas, and petro ...

. In January 2011, Rosneft announced that it will form a strategic alliance with BP to develop the East-Prinovozemelsky oil and gas field. For the development activities, a joint operating company was to be created in which Rosneft would have 66.67% and BP would have 33.33% of shares. Initial stages of exploration activities would to be financed by BP. The deal was blocked by BP's subsidiary

TNK-BP TNK-BP (Tyumenskaya Neftyanaya Kompaniya, Tyumen Oil Company) was a major vertically integrated Russian oil company headquartered in Moscow. It was Russia's third-largest oil producer and among the ten largest private oil companies in the world ...

, a joint venture with a group of Russian billionaires, known as AAR ( Alfa-

Access Access may refer to: Companies and organizations * ACCESS (Australia), an Australian youth network * Access (credit card), a former credit card in the United Kingdom * Access Co., a Japanese software company * Access Healthcare, an Indian BPO se ...

- Renova), due to a dispute over Russian exploration rights between the two companies, and was nullified.

Rosneft–ExxonMobil joint venture

On 30 August 2011, Rosneft announced that instead of BP the partner for EPNZ-1, EPNZ-2 and EPNZ-3 will be ExxonMobil. The two companies agreed to invest US$3.2 billion in a joint venture to develop the three East-Prinovozemelsky blocks, as well as a field offshore of

Tuapse Tuapse (russian: Туапсе́; ady, Тӏуапсэ ) is a town in Krasnodar Krai, Russia, situated on the northeast shore of the Black Sea, south of Gelendzhik and north of Sochi. Population: Tuapse is a sea port and the northern center of ...

. Under the terms of the contract, Rosneft will own two-thirds of the joint venture, with Exxon controlling the remainder. The first oil produced from the fields was expected to be drilled in 2015, with ExxonMobil at least initially paying for most construction costs. Total investment to the East-Prinovozemelsky blocks, according to Russian Prime Minister

Vladimir Putin Vladimir Vladimirovich Putin; (born 7 October 1952) is a Russian politician and former intelligence officer who holds the office of president of Russia. Putin has served continuously as president or prime minister since 1999: as prime min ...

, could possibly reach as high as $500 billion, though ExxonMobil's officials said that in the near term, it is likely that investments will reach only tens of billions of dollars. After Russia annexed Crimea in 2014, the US imposed sanctions that blocked the partnership, and after ExxonMobil received a brief exemption in order to safely complete drilling a well it withdrew from East-Prinovozemelsky. ExxonMobil was later granted a limited waiver to maintain "administrative actions" in the joint venture, and in March 2017 applied to the US government for a full waiver that would allow it to resume drilling in partnership with Rosneft. The request was denied in April, though the decision was not immediately fatal for the venture, as under the terms of the agreement ExxonMobil has until 2023 to begin operations in the field.

Reserves

The South Kara Sea hydrocarbons basin lies on the same geological trend with the Western Siberian hydrocarbon province. The East-Prinovozemelsky area covers . According to Rosneft, the estimated oil in place is and the estimated natural gas in place is . Of this of oil and of gas lies in EPNZ-1 block, of oil and of gas in EPNZ-2, and of oil and of gas in EPNZ-3.

References

{{ExxonMobil Oil fields of Russia Natural gas fields in Russia Industry in the Arctic Rosneft oil and gas fields