Russia’s Rosneft and the UK-based energy giant BP have on Friday signed an agreement on strategic cooperation in natural gas and LNG.
The duo signed a Memorandum of Understanding (MoU) in respect to the sale and purchase of natural gas in Europe.
Rosneft and BP agreed to develop integrated cooperation in gas and aim to jointly implement gas projects in Russia and abroad focused on gas exploration and production, LNG production, supply and marketing, according to a jont statement.
The two companies also reconfirmed their mutual interest in cooperation in European gas marketing.
Under the memorandum, Rosneft and BP’s wholly-owned subsidiary BP Gas Marketing Limited will enter into a long-term sales and purchase agreement for the supply of natural gas produced by Rosneft in order to ensure delivery of additional Russian gas supplies to European markets starting from 2019.
“Rosneft already is the largest independent gas producer in Russia and intends to further increase production levels in the coming years,” Rosneft CEO Igor Sechin said. “Cooperation with BP would provide Rosneft with both a new efficient gas monetization channel and the conditions required for the development of a new resource base including hard to recover gas reserves.”
“BP is pleased to expand its ongoing relationship with Rosneft through this agreement,” president of BP Russia David Campbell added. “Shifting to gas is one of the pillars of BP’s strategy. It is important in order to meet the increasing demand for cleaner energy. Gas is a growing proportion of BP’s portfolio and by the middle of the next decade we expect around 60% of our production to be gas, compared with around 50% today.”