Gazprom Neft, Repsol, Shell form JV to explore Gydan blocks

Gazprom Neft, Repsol and Shell have signed a memorandum of understanding on establishing a joint venture to develop the Leskinsky and Pukhutsyayakhsky license blocks on the Gydan Peninsula.

Under this memorandum, the parties plan to have detailed terms in place by the end of 2019, as well as singing an agreement on establishing the joint venture, Gazprom Neft said in its statement on Friday.

The deal is expected to be closed in 2020 once all necessary corporate and regulatory approvals have been obtained, and all legal preconditions met. The licenses to the Leskinsky and Pukhutsyayakhsky blocks on the Gydan Peninsula will be added to the company’s asset portfolio.

Gazprom Neft will have a 50-percent interest in the joint venture once the transaction has closed, with Repsol and Shell each holding 25 percent.

Vadim Yakovlev, first deputy CEO, Gazprom Neft, said, “While still an under-explored territory, we do, however, understand that Gydan conceals massive resource potential.”

Establishing this joint venture is intended to develop an under-researched exploration cluster in the north—east of the Gydan Peninsula. The Leskinsky license block is located in the Taymyrsky district of the Krasnoyarsky Krai, and covers an area of 3,027 square kilometers. Official estimates put D2 recoverable oil reserves at 100 million tonnes of oil equivalent (mtoe).

Adjoining the Leskinsky block, the Pukhutsyayakhsky block, which covers an area of 825 square kilometers, is located in the Tazovsky district of the Yamal-Nenets Autonomous Okrug. According to official estimates, recoverable D1 and D2 oil reserves stand at 35 mtoe.

Both blocks are under-explored and located in considerable distance from oil-and-gas and transport infrastructure.