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Russian energy giant Rosneft has commenced construction of an oil terminal in the Arctic for its Vostok Oil project in the Far East region of the country, reported Reuters.

Located at the Bukhta Sever port, the new terminal will be equipped to support oil production handling from the Vostok oil fields involving the Northern Sea Route.

Comprising 102 reservoirs, the oil terminal is expected to become the biggest of its kind in the country upon completion, which is scheduled for the end of this decade.

The terminal is planned to be built in phases, with the first phase involving the construction of three cargo and two oil berths, and an acceptance/shipment point with 27 tanks, according to Portnews.

Rosneft also started production drilling at the Irkinsky licensed area in Vostok Oil project’s Paiyakhskoye field on the Taimyr Peninsula.

Vostok Oil general director Vladimir Chernov was quoted by Interfax as saying to reporters: “Production [well] clusters are beginning to be drilled, meaning the project is moving from the stage of geological exploration to the stage of production. These are already production wells that will then be tied into pipelines and produce oil.”

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By GlobalData

The field is planned to start production in 2024.

“By 2027, there will already be a good result, up to 50 million tonnes from the Vostok Oil project will be delivered to world markets along the Northern Sea Route,” Chernov added.

Located on the Taimyr Peninsula, the Vostok Oil project includes 52 licensed areas in the northern part of the Krasnoyarsk Territory and in the Yamalo-Nenets Autonomous District.

As per the estimates, the project holds a resource base of 6.2 billion tonnes of liquid hydrocarbons.

Amid the Russia-Ukraine crisis, Ukraine’s state-owned energy company Naftogaz is nearing default following the refusal of a two-year debt freeze plan by its bondholders.

Following the rejection by international investors, the state energy company sought approval from the government to repay a $335m bond, which matured last week. The request, however, was rejected.

The payment’s five-business-day grace period expired on 26 July 2022.