Venezuela
Rosneft is one of the world’s largest investors in Bolivarian Republic of Venezuela (BRV).
The Company continues to consistently expand its cooperation in crude oil production with Petróleos de Venezuela, S.A. (PDVSA), a Venezuelan national company.
Rosneft successfully implemented five joint exploration and production projects with PDVSA in Venezuela, including three projects currently at the production stage which are Petromonagas (Rosneft share is 16.67%), Petroperiha (Rosneft share is 40%) and Bokeron (Rosneft share is
26.67%), one pilot development project, Petromirinda (Rosneft share is 32%), and one exploration project, Petrovictoria (Rosneft share is 40%). Projects in Venezuela are mainly involved in low-grade oil production. A total of 8.8 mmt of oil was produced in 2015, including Rosneft share of 1.67 mmt.
The largest reserves are available under Junin-6 and Karabobo 2/4 projects. JV Petromiranda was started to implement Junin-6 project located in the low-grade oil belt in the Orinoco River basin
in 2010. Phase 1 is currently in progress. It stipulates additional field development and infrastructure engineering. Pilot development of a priority area is being performed to determine pay zone characteristics.
JV Petrovictoria was incorporated to implement the project in Karabobo 2/4 block in 2014.
An additional development program was elaborated in 2015. The synergy with JV Petromonagas during field development was evaluated. A memorandum was signed with PDVSA to agree on key project development indicators from 2015 through 2017, and exploration drilling was started
in November 2015 in the early production area.
Rosneft is considering expanding its business by participating in the gas and condensate field development project in Michelones, Patao and Riu Caribe offshores of Venezuela with the proved reserves and gas monetization as LNG for export.
Rosneft is contributing efforts to set up joint ventures with PDVSA to render oil-related and infrastructure construction services. These operations will foster expansion of the Company’s business in Venezuela and improve exploration and production performance. Involvement in well drilling in 2015 of Precision Drilling de Venezuela under its subsi diary’s projects increased field drilling rates, while decreasing drilling costs.
The Company reviewed expansion of its cooperation with PDVSA in other areas, including the implementation of joint hydrocarbon production projects on Venezuelan shelf.
Rosneft and PDVSA are increasing their cooperation in oil and oil product supplies. In June 2015, they signed an agreement on the Key Terms and Conditions for Russian Urals Oil Supply to Venezuela.
Rosneft and PDVSA in Venezuela
Rosneft is actively involved in socially important projects, including the construction of a martial arts center in the country. Venezuelan nationals can study at the Company’s partner colleges and universities in the Russian Federation. In 2015, Rosneft, PDVSA, and the Gubkin Russian State University of Oil and Gas signed a memorandum of cooperation in education and science, as well as a contract on education for PDVSA employees.
The Joint Venture Agreement between Rosneft and the State Oil Company of Azerbaijan Republic (SOCAR) is considering selection of assets of both companies to be included into operations of the joint venture. SOCAR may potentially hand-over to the joint venture its participation share in the offshore Absheron field in the Kaspian Sea.
Brazil
Rosneft has been participating in the hydrocarbon exploration and development project since 2012 (via its subsidiary Rosneft Brasil E&P Ltda., hereinafter, RN-Brazil) in the license areas in the Solimões River basin (State of Amazonas, Brazil). A transaction was closed in October 2015 to acquire 55% share in the project from PetroRio. Currently, RN-Brazil owns 100% of the property rights to the areas in Solimões River basin and is a project operator. The Company plans long-term seismic surveys and drilling of two exploration wells in 2016 and 2017.
Mozambique
A consortium was formed with ExxonMobil in 2015 to develop international cooperation by participating in the 5th license round in the Republic of Mozambique. Based on the results of the joint application submission the consortium was awarded with three blocks (А5-В, Z5-C, and Z5-D) at the country’s offshore (Rosneft’s share – 20%). Commencement of operations under the project is planned for Q3-4, 2016 upon signing concession agreements with the Mozambique Government.
Vietnam
Rosneft participates in a joint gas and condensate production project in the Socialist Republic of Vietnam, as well as in exploration projects in PLDD Block 06.1 (35% held by Rosneft Vietnam B.V., 45% held by ONGC, and 20% held by PetroVietnam).
The Company signed a production sharing agreement for the development of 05.3/11 Blocks in 2013.
Rosneft is also a party to the offshore Nam Con Son pipeline project involving export and treatment of gas and gas condensate produced in offshore blocks in the Nam Con Son basin (32.7% held by Rosneft Vietnam Pipelines B.V., 16.3% held by Perenco, and 51% held by PetroVietnam).
In 2015 gas and gas condensate production in 06.1 Block fields totaled 24.34 mmtoe (including 3.85 bcm of gas in 100% share), which was significantly above the minimum buyer’s (Petrovietnam Gas) commitments under the current contract.
Gas and gas condensate production at the Block 06.1 of Vietnam fields made 24.34 mboe
Rosneft Vietnam B.V., subsidiary, had several milestone events in 2015. An important operational highlight was achieved on June 22, 2015 marked by 13 years of zero life accident offshore operations. It is one of the best figures globally. Another important date was May 1, 2015 with 300 mm boe (including 46.6 bcm of gas in 100% share) produced in 06.1 Block (Nam Con Son basin) operated by Rosneft Vietnam B.V. since the start of field development. These events were highly praised by Petrovietnam management and in November 2015, Rosneft Vietnam B.V. received a high national award, Order of Labor, Second Degree.
Agreements were signed in August 2015 on the provision of an offshore drilling rig and supply of long load equipment while preparing for drilling of two exploration wells (in PLDD 06./1 Block and 05.3/11 Block). The drilling of an exploration wells in PLDD and 05.3/11Block is scheduled for 2016. Additional 3D seismic surveys in 06.1 Block are also planned for 2016 to evaluate the potential of new promising formations.
I’M SURE OUR EXPERIENCE IN VIETNAM SHALL BE APPLIED NOT ONLY FOR THE COMPANY’S OPERATIONS IN SOUTHERN SEAS. THE ACQUIRED COMPETENCES WILL BE USED FOR PLANNING AND IMPLEMENTING THE UPSTREAM PROJECTS IN DISTANT REGIONS. I WOULD LIKE TO EMPHASIZE THAT THE PROJECT IMPLEMENTATION SETS AN EXAMPLE OF PROGRESSIVE COOPERATION OF THE COMPANY WITH OUR Asia-Pacific PARTNERS — PETROVIETNAM AND ONGC. WE HIGHLY RATE THE CURRENT STATE OF THE JOINT PROJECTS IMPLEMENTATION IN VIETNAM AND THEIR FUTURE DEVELOPMENT».
Igor Sechin Commencement of PLDD-1X exploration well drilling at the Block 06.1 of Vietnam offshore, March, 2016