The joint venture of LUKOIL and Norilsk Nickel, Vareineftegaz, acquired Laduketskoye LLC
LUKOIL (MOEX: LKOH) and Norilsk Nickel (MOEX: GMKN) expanded the perimeter of their large oil and gas production cluster, created on the basis of the parity joint venture Vareineftegaz. As Kommersant expected at the end of 2023, Vareineftegaz received the Laduketsky site in the Krasnoyarsk Territory with projected resources of 19.2 million tons of oil and 79 billion cubic meters of gas. The license for the site previously belonged to LUKOIL, which acquired the asset at an auction in 2022, paying about 5 billion rubles. The total resource base of Vareineftegaz is estimated at 95 million tons of oil and 584 billion cubic meters of gas, but it still needs to be confirmed during geological exploration.
The parity joint venture of LUKOIL and Norilsk Nickel, Vareineftegaz, acquired Laduketskoye LLC, which owns the license for the Laduketsky site in the Krasnoyarsk Territory, follows from the Unified State Register of Legal Entities. About plans to include the Laduketsky site in Vareineftegaz Kommersant reported still December 26, 2023. Previously, the license for this area was owned by LUKOIL itself, which won the asset at the Rosnedra auction back in 2022, paying about 5 billion rubles. Forecast resources for category D1+D2 of the Laduketsky area are 19.2 million tons of oil and 79 billion cubic meters of gas.
LUKOIL and Norilsk Nickel did not respond to Kommersant’s request.
Vareineftegaz is a rare example of partnership between companies from different industries. LUKOIL and Norilsk Nickel created a joint venture in September 2023. It already includes the Yuzhno-Payutsky, Yuzhno-Ushakovsky, Severo-Vareisky (1, 2, 3) sections. The first two are located in the Krasnoyarsk Territory, the rest are in the Yamalo-Nenets Autonomous Okrug. Currently, the areas of Vareineftegaz are in the geological exploration stage. The total resource base is projected at 505 billion cubic meters of gas and 76 million tons of oil. Drilling is due to begin in 2025.
According to Kommersant, in the south the Laduketsky site borders on the Yuzhno-Payutsky and Payutsky sections of NOVATEK. Norilsk Nickel produces gas at fields in the Krasnoyarsk Territory with reserves of 250 billion cubic meters of gas and 5 million tons of condensate - Pelyatkinskoye, Yuzhno-Soleninsky, Severo-Soleninsky, Messoyakha. These areas are located in close proximity to the Vareineftegaz sites.
Norilsk Nickel has been actively fighting for gas areas in the region in recent years, as it is interested in long-term gas supply to the Norilsk industrial region. LUKOIL's interest in partnership is explained by the replenishment of the oil resource base in conditions when the chances of acquiring large oil fields in the Russian Federation are small. LUKOIL is also part of joint ventures for the development of fields in Russia with Gazprom and a subsidiary of the monopoly Gazprom Neft.
The head of the Gekon consulting center, Mikhail Grigoriev, believes that since the licensed areas are located in close proximity to the fields of Norilskgazprom and Norilsk Nickel, their development will be ensured with minimal construction of new transport infrastructure. Gas specialization determines the main goal of Norilsk Nickel's participation - ensuring long-term gas supply for heat and power generation in the Norilsk industrial region, while oil will most likely be sent to the Transneft system, the analyst says.
Prospects for the development of LUKOIL hydrocarbon production in Russia lie in the fields of the Caspian and Baltic Seas, notes Andrey Polishchuk from Euler Analytical Technologies. In 2023, LUKOIL began production at the Graifer field in the Caspian Sea with a production potential of 1.2 million tons per year and is developing fields in the Baltic. Additional opportunities for LUKOIL are concentrated in the hard-to-recover oil fields in Western Siberia. The potential of these projects can be realized when OPEC+ restrictions are relaxed, the analyst believes. At the same time, according to him, LUKOIL continues to look for growth points in foreign projects that will increase production under the OPEC+ deal.
