Huge Exxon Russian Deal Is Announced

30.08.2011
Exxon Mobil Corp. and OAO Rosneft, Russia's largest oil producer, entered a partnership that may generate as much as $500 billion of investments.

The U.S. and Russian giants executed a Strategic Cooperation Agreement, calling for them to jointly explore and develop hydrocarbon resources in Russia, the U.S. and elsewhere. It also includes "technology and expertise sharing activities," in a release.

The agreement was signed by Rosneft President Eduard Khudainatov and Exxon Mobil Development Co. President Neil Duffin, with Russian Prime Minister Vladimir Putin in attendance. It includes about $3.2 billion to be spent on Kara Sea and Black Sea exploration, described as being "among the most promising and least explored offshore areas globally, with high potential for liquids and gas."

Bloomberg News noted that Exxon and Rosneft had signed on a preliminary accord on Jan. 27 for a $1 billion exploration project in the Black Sea's deepwater Tuapse Trough.

Bloomberg's report also noted that it was Putin who had said that as much as $500 billion of investments could flow from the deal. "It's scary to utter such huge figures," Putin said after discussing the potential for outlays, which would involve all the associated infrastructure to be built.