Russia’s state-owned oil company Rosneft signed a $500 billion deal with Exxon Mobil to develop offshore fields in the Russian Arctic circle. The deal is for an unspecified number of years. Russia’s deputy prime minister (and top official in all things oil) Igor Sechin signed the deal with Exxon’s CEO Rex Tillerson on 30 August, while Prime Minister Vladimir Putin looked on approvingly.

Both companies said the exploration for undeveloped gas and oil fields in the Kara Sea would cost about $3.2 billion. The $500 billion figure is Putin’s own estimation of what the deal is worth.

Rosneft had signed a deal with British Petroleum to develop assets in the Arctic, but that deal fell through after BP’s shareholders in Russia successfully blocked it. Market analysts in Russia believe the Medvedev-supported BP deal fell through because Putin’s people encouraged the shareholders aligned to the Russian president to scupper it.

Pavel Salin, an analyst at Russia’s Centre for Current Politics, said: “Putin is demonstrating he is the person in charge and if Exxon Mobil had tried to make the deal with Medvedev, nothing would have happened.”
Neither Putin nor Medvedev have signalled their intentions for next year’s presidential race, but Exxon Mobil is already banking on Putin making a huge comeback as president. iM

Read more:

• Exxon Mobil sings Arctic oil deal with Russia, on Al Jazeera English
• Exxon deal sets stage for Putin to return to the Kremlin, on Reuters

Photo: Reuters