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Gazprom Neft, Mubadala Petroleum and the Russian Direct Investment Fund (RDIF) announce the completion of a transaction to jointly develop oil fields in Western Siberia

05 September 2018

St. Peterburg: Gazprom Neft, Mubadala Petroleum and the Russian Direct Investment Fund (RDIF, the sovereign wealth fund of the Russian Federation) have announced the completion of a transaction establishing a joint venture to develop oil fields in the Tomsk and Omsk regions of Western Siberia.

Further to an agreement announced on 24 May 2018, Gazprom Neft has now completed its sale of a 49-percent interest in Gazpromneft-Vostok LLC, operator of 13 fields, to Mubadala Petroleum and RDIF. Following the completion of this transaction Gazprom Neft now holds a 51-percent interest in the joint venture, with Mubadala Petroleum and RDIF holding 44 percent and five percent equity, respectively. Gazpromneft-Vostok remains a subsidiary of Gazprom Neft, and will continue to operate the fields.

The Gazpromneft-Vostok joint venture represents Mubadala Petroleum’s first investment in the Russian oil and gas sector.

The partners will determine the long-term strategy of the joint-venture, focusing on efficiency in exploration and production activities at the fields as well as at pre-Jurassic hydrocarbon deposits.

Alexander Dyukov, CEO, Gazprom Neft PJSC, commented: “This first investment by one of the largest oil and gas companies in the United Arab Emirates, Mubadala Petroleum, in a Russian asset is certainly a landmark event for the industry. Through our partnership with Mubadala Petroleum and RDIF we will not only be focusing on improving the current business performance of Gazpromneft-Vostok, but will also be looking for new opportunities to develop it further. One promising area for joint work here being developing technologies for the profitable development of pre-Jurassic hydrocarbon resources in the Tomsk Region. We see Mubadala Petroleum and RDIF as strategic partners, and expect to deliver mutually beneficial results from combining our financial and technological resources.”

Dr. Bakheet Al Katheeri, CEO, Mubadala Petroleum, said: "The acquisition of a 44-percent interest in the Gazpromneft-Vostok joint venture is another important step in Mubadala Petroleum’s drive for sustainable and profitable growth, marking our entry into Russia and adding valuable oil production to our existing portfolio. Partnering with Gazprom Neft, a leading Russian operator, and RDIF will not only provide us with significant co-investment opportunities, but will also further develop our own oil and gas expertise and capabilities, as well as exploration and production technologies.”

Kirill Dmitriev, CEO of the Russian Direct Investment Fund (RDIF), said: "We welcome Mubadala Petroleum’s first investment in Russia. We expect this transaction to become the basis for further investments by the consortium created by RDIF, Mubadala Petroleum and Gazprom Neft. Participation of Mubadala Petroleum in the consortium will bring funds, experience and expertise of our Middle East partner to the Russian oil and gas sector".

NOTES FOR EDITORS:

Gazprom Neft is a vertically integrated oil company, primarily involved in oil and gas exploration and production, refining, and the production and sale of oil products. The Company’s subsidiaries include more than 70 oil production, refining and retail businesses, located throughout Russia, Commonwealth of Independent States (CIS) and other countries.

The Company’s proven and probable reserves (SPE-PRMS) are estimated at 2.78 billion tonnes of oil equivalent (btoe), making Gazprom Neft one of the 20 largest oil and gas companies worldwide. Gazprom Neft is also a Top 3 company in Russia in terms of production and refining volumes. Total production in 2017 amounted to 89.75 million tonnes of oil equivalent (mtoe), with refining volumes at 40.1 million tonnes.

Gazprom Neft’s products are sold throughout Russia and exported to over 50 countries worldwide. The Company’s filling station network is made up of more than 1,850 outlets throughout Russia, CIS and Europe.

In 2017, Gazprom Neft’s net profit was RUB 253 billion, a 26.5-percent increase year-on-year. The Company is a market leader both in terms of its financial performance and efficiency, including its return on average capital employed (ROACE).

The Company’s majority shareholder is Gazprom PJSC (95.68%), with the remaining shares in free float.

Gaspromneft-Vostok LLC: Registered in the Russian Federation on 14 September 2005, Gazpromneft-Vostok has been active in hydrocarbon production in the Tomsk and Omsk regions since 2005, as operator of a group of oil and gas fields located in the region and whose future production potential derives mainly from pre-Jurassic deposits.

The company holds subsoil usage licenses to the Shinginsky, Zapadno-Luginetsky, Yuzhno-Pudinsky, Archinskiy, Urmansky, and Krapivinskoye licence blocks, and was awarded a further subsoil usage licence for geological prospecting at the Parabelsky block in 2017. Thirteen oil fields have been discovered within the territory of these licence areas.

Proved and probable hydrocarbons at Gazpromneft-Vostok fields stand at approximately 40 million tonnes (SPE-PRMS, approximately 300 million barrels). Oil production in 2017 totalled 1.6 million tonnes (approximately 33,000 barrels per day). This production crude is sold into the Russian domestic and international markets, transported primarily through the Eastern Siberia–Pacific Ocean oil pipeline, as well as being sent for processing at Russian refineries.

Mubadala Petroleum is an international upstream oil and gas exploration and production company, headquartered in Abu Dhabi, and a wholly-owned subsidiary of Mubadala Investment Company. Mubadala Petroleum manages assets and operations now spanning 10 countries, with its geographic focus primarily on the Middle East, Southeast Asia and Russia. Production in 2017 averaged around 320,000 barrels of oil equivalent per day. Mubadala Petroleum’s success is built on strong partnerships, the passion and capability of its people, and its focus on performance.  For more information, please visit www.mubadalapetroleum.com

The Russian Direct Investment Fund (RDIF) is Russia's sovereign wealth fund established in 2011 to make equity co-investments, primarily in Russia, alongside reputable international financial and strategic investors. RDIF acts as a catalyst for direct investment in the Russian economy. RDIF’s management company is based in Moscow. Further information can be found at www.rdif.ru

For additional information contact:

Mubadala Petroleum
Angela Soeteber
Acting Head of Communications
M: +65 9018 2071
E-mail:

Gazprom Neft:
Head of PR department
Oleg Brakorenko
Tel: +7-812-363-31-52 (3204)
E-mail:
Mobile: +7-921-900-63-41

Russian Direct Investment Fund
Arseniy Palagin
Press Secretary
Tel: +7 495 644 34 14, ext. 2395
Mobile: +7 916 110 31 41
E-mail: