Eni Energy Russia has signed an agreement with Rosneft and its subsidiary Val Shatskogo to finance exploration activity at three offshore license blocks in Russia.
The blocks include the Fedynsky and Central Barents blocks in the Barents Sea and the Western Chernomorsky block in the Black Sea.
The agreement is determined by previous agreements between the two companies to jointly pursue exploration activities offshore of Russia.
Eni will fully finance geological works stipulated in license obligations, under the terms of the current agreement.
The company holds a 33.33% stake while Rosneft holds a 66.67% stake in the projects.
Additional expenditure for exploration outside of the license obligations will be split between the companies.
The majority of historical costs on completed geological works at the blocks will be compensated by Eni, which will secure its investment from project cash flows once production is launched.
If production does not begin at the offshore blocks, Rosneft will not be obliged to return the investment.
Prospective recoverable resources of two billion tons of oil and 1.9 trillion cubic metres of gas are estimated at the Fedynsky and Central Barents license blocks.
At the Western Chernomorsky block, estimated recoverable resources stand at 1.36 billion tons of oil.
Image: Rosneft headquarters, Moscow, Russia. Photo courtesy: Rosneft.