Norwegian oil giant
) has inked an agreement with Russian state-owned oil company
Rosneft to complete its earlier co-operation deal that
encompasses exploration of the Kashevarovsky, Lisyansky and
Magadan-1 licenses in the Sea of Okhotsk north of Sakhalin Island
and the Perseevsky license in the Barents Sea. The co-operation
deal was signed in May 2012.
Statoil, with a 33.33% stake of 33.33% in the joint venture, will
be liable to fund the majority of exploration costs on an
offshore acreage of about 102,000 square kilometers. Rosneft will
hold the remaining 66.67% and will pay back its share of
exploration costs from the future production at commercial
Per the requirement of the license, Statoil will need to drill 6
exploration wells during the period from 2016 to 2021 and will
carry the cost of exploration activities necessary to establish
the commercial value of the licenses.
Recently, both the companies signed a heads of agreement for the
joint pilot development of Domanik shale formations in 12
licenses in the Samara region. Rosneft will hold the majority
stake of 51% in the project and Statoil will have a stake of 49%.
According to the terms of the agreement, Statoil will provide
carry-based financing of about $60 million for a pilot survey
program as well as technology to explore the shale play.
Earlier this month, Statoil was awarded interests in production
license 713 and six other licenses in the Barents Sea in the
twenty-second licensing round on the Norwegian Continental Shelf.
PL 713 spans 1,213 square kilometers and lies adjacent to the
recently discovered Johan Castberg field.
These licenses, which are considered to be of high priority in
this round, have solidified the company's position in the region
and formed a solid foundation for further growth.
Moreover, Statoil's close co-operation with Rosneft both in the
Norwegian and Russian parts of the Barents Sea will help in
leveraging the combined experience of operating in extreme
environments of both the companies. Statoil will also continue to
work with Italian explorer,
) - its long-standing partner in the area.
Statoil carries a Zacks Rank #4 (Sell). However, there are other
Zacks Ranked #1 (Strong Buy) stocks -
Newpark Resources Inc.
Gulfmark Offshore, Inc.
) - that are expected to perform impressively over the short
ENI SPA-ADR (E): Free Stock Analysis Report
GULFMARK OFFSHR (GLF): Free Stock Analysis
NEWPARK RESOUR (NR): Free Stock Analysis
STATOIL ASA-ADR (STO): Free Stock Analysis
To read this article on Zacks.com click here.