Equinor has completed an agreement with Rosneft that increases its onshore presence in Russia.
Through this agreement Equinor has acquired a 49% interest in the limited liability company LLC KrasGeoNaC (KGN) which holds twelve conventional onshore exploration and production licenses in Eastern Siberia.
The payment at completion of the transaction is around USD 550 million, which includes a cash consideration of USD 325 million at the effective date of 1 January 2019, and customary adjustments. As part of this agreement, Equinor has redirected its remaining exploration commitments offshore in the Sea of Okhotsk and as such has no outstanding obligations in that area.
One of these twelve licenses, the North Danilovsky development, started production in July this year. Production is expected to reach 40,000 barrels of oil per day by 2024, with subsequent plans to increase this to 70,000 barrels of oil per day.
Pursuant to the 2018 agreement between Equinor and Rosneft to cooperate on health, safety and sustainability, Equinor will collaborate with Rosneft in these areas across the KGN assets.