On this Tuesday, Rosneft stated that the company is seeking to be alliance of ExxonMobil or other partners of Iraq. The company is looking forward to double its Russian gas market share by the year of 2020 through enhancing its credentials as world’s one of the largest crude producers.
Igor Sechin, Rosneft's Chief Executive Officer, stated that the company is considering to get teamed up with ExxonMobil for a long term in order to reach the company’s goal through mutual cooperation. Going one step further, Mr. Sechin said that the company is ready to make high profitability from Iraqi natural gas and oil through making partnership with any company, which is interested. However, teaming up with Exxon is the main aim of the company and on this purpose; Iraqi delegation team will reach at Moscow on 10th May.
Rosneft has been expanding since Sechin, a powerful long-standing ally of Russian President Vladimir Putin, was appointed to head Russia's top oil producer last May. He also remarked that the Iraqi Ministry will visit Moscow soon.
It bought Anglo-Russian oil company TNK-BP from BP and the AAR consortium of Soviet-born tycoons for $55 billion. The company won a few deals with international majors to tap Russia's Arctic hydrocarbon reserves, and acquired domestic gas producer Itera.
Sechin stated that the united company may reach a capital hold, around $120 billion in coming 2 years. Hence, it is anticipated that the company will grow as the largest oil and gas producing company of Russia, beating $ 90 billion assets of the Gazprom.
For wider privatization, state is considering selling 19 percent of Rosneft. However, Sechin has claimed that he still has not received such instructions yet from the government. Though the prospects of selling state’s share in the company is still under the questions!
The Gas War
Rosneft has raised its stakes in order to beat Russian state-owned cooperation Gazprom, which is a well-known company. By the year of 2020, the company is aiming to double its domestic gas production, as declared by Rosneft management.
From 9 percent to 19 percent – the share of the company, i.e. Rosneft can be uplifted as revealed in recent times. However, the amount is not confirmed yet. It expects to produce more than 40 billion cubic meters (bcm) in 2013, over 60 by 2016 and 100 bcm in 2020, of which more than half is to be produced at newly-acquired projects.
To win this strategic war, recently Vlada Rusakova, former Gazprom executive has been recruited by Rosneft. Rosneft's main onshore gas project is the Kharampurskoye field - in Russia's largest gas-producing region, Yamal Nenets - which holds more than 400 bcm in reserves. The offshore project Sakhalin-1 in the Russian Far East of the company has been supervised in a joint effort by Rosneft, tied up with ExxonMobil.
Rosneft will also get teamed up with Exxon to build a $15 billion liquefied natural gas plant in Russia's Far East. This project is expected to be completed by the year of 2018. According to the Oxford Institute for Energy Studies, Russia's gas consumption in 2013 will outstrip the pre-crisis level of 2008.
Rosneft is teaming up with TNK-BP, in order to cut down the capital expenditure of the company. It expects capex of $20 billion this year. The previous guidance for Rosneft's capex was $15 billion, and $6 billion for TNK-BP. Sechin remarked that the company will be able to reduce its spending after the deal with TNK-BP.