New deal: covering the vast Samotlor field
TNK-BP seals Samotlor carbon deal
Russian producer TNK-BP and French bank BNP Paribas have signed to deals to to trade Kyoto Protocol carbon offsets and develop new projects to cut greenhouse gases.
BNP Paribas will buy an undisclosed number of offsets, called Emissions Reduction Units (ERUs), to be delivered in the first half of next year, BNP's head of power, gas and emissions trading Simon Dent told Reuters.
The ERUs will be generated by the Samotlorneftegaz project, which will capture and produce energy from an estimated 90 million cubic metres of previously flared gas at the Samotlor oilfield in Siberia.
Dent said the project is expected to generate around 900,000 tonnes of ERUs by 2012, the year Kyoto expires.
The second agreement will see two new emissions reduction projects developed by TNK-BP and BNP Paribas, one a new low-carbon power plant and the other a project to capture more natural gas. The companies would not disclose the number of ERUs to be generated by these projects.
"With this signature, both the French and Russian authorities demonstrate their belief that Joint Implementation projects can be successfully developed in Russia, and we expect formal approval very soon," Reuters quoted Sylvain Goupille, deputy head of carbon finance at BNP Paribas, as saying.
Under Kyoto's Joint Implementation (JI) scheme, companies can invest in clean energy projects in countries that have signed up to targets under the international climate pact, and in return receive ERUs which can be sold for profit.
In October, Russia approved new rules for the development of JI projects, a green light for investors after months of regulatory uncertainty.
In a decree by Prime Minister Vladimir Putin, Russia appointed state-controlled Sberbank as the "operator of carbon units", an intermediary for emissions deals under Kyoto between Russian and foreign companies.
Putin and French Prime Minister Francois Fillon were also present at the deal signing, BNP Paribas said in a statement.
Russia is home to more than 100 JI projects expected to cut over 200 million tonnes of carbon dioxide by 2012, according to United Nations data.
Samotlor is TNK-BP's largest deposit in west Siberia, which makes up more than 40% of the company's output.
Once the Soviet Union's prized field, making up half of Soviet oil output when peaking at 7 million barrels per day in the 1980s, Samotlor is now 70% depleted.