Mubadala unit inks JV deal to develop oil fields in Siberia

Arabian Business, 24.05.2018

The project with the Russian Direct Investment Fund and Gazprom Neft is Mubadala Petroleum's first investment in the Russian oil and gas sector

UAE-based Mubadala Petroleum has announced it is part of a new joint venture to develop several oil fields in Siberia.

The oil and gas exploration and production company has teamed up with the Russian Direct Investment Fund (RDIF) and Gazprom Neft to develop the oil fields in the Tomsk and Omsk regions.

The project is Mubadala Petroleum’s first investment in the Russian oil and gas sector.

RDIF and Mubadala Petroleum will acquire a 49 percent equity stake in Gazpromneft-Vostok, the operator of the fields.

Mubadala Petroleum will hold a 44 percent interest and RDIF will hold the remaining 5 percent interest. Completion of the transaction is subject to customary regulatory and internal approvals. The agreement was announced at the St Petersburg International Economic Forum.

Proved and probable reserves of hydrocarbons in the fields are about 40 million tons (approximately 300 million barrels), a statement said.

It added that oil production was 1.6 million tons in 2017 (about 33,000 barrels per day). The produced oil is sold into Russian domestic and international markets, and transported primarily through the Eastern Siberia-Pacific Ocean oil pipeline.

Dr Bakheet Al Katheeri, CEO of Mubadala Petroleum, said: "This investment marks a further step in our long-term growth strategy and sees Mubadala Petroleum’s entry into Russia. Through this new partnership with RDIF and Gazprom Neft, one of Russia’s leading operators, we will not only share but also further build on our expertise and capabilities in oil and gas while adding significant oil production to our existing oil and gas portfolio. "

Kirill Dmitriev, CEO of RDIF, added: "RDIF and Mubadala Petroleum investment in a joint venture with Gazprom Neft brings the experience and expertise of our Middle East partners to the Russian oil and gas sector. RDIF, Mubadala Petroleum and Gazprom Neft see this project as the first step in creating a consortium to pursue further significant investments in the sector."