Russian oil producers Rosneft and Gazprom Neft have signed agreements with Baker Hughes and Shell, respectively, that are aimed at driving down carbon dioxide and methane emissions at their operations.


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The pacts are in line with repeated declarations from both Russian companies that they are striving to adapt their operations to comply with quickly tightening environmental, social and governance standards of Western countries.

Rosneft, the country's largest oil producer, signed a co-operation agreement with US oilfield services giant Baker Hughes to explore possibilities for using hydrogen as an alternative fuel in its operations.

Rosneft also expects Baker Hughes to provide it with “technologies and equipment” to discover, gauge and reduce greenhouse emissions, with the focus on cutting down on methane leaks.

Unveiling the pact during this week's St Petersburg Economic Forum, Rosneft added that the scope of this co-operation agreement extends to its giant planned greenfield project, known as Vostok Oil.

CCUS on menu

Gazprom Neft, meanwhile, said its memorandum of understanding with Anglo-Dutch supermajor Shell calls for both companies to explore the possibility of deploying carbon capture, utilisation and storage (CCUS) solutions at their joint ventures in Russia.

Both companies are equal partners in the Salym Petroleum Development oil venture in Russia, where production is about 115,000 barrels per day.

Shell is also a partner of Gazprom Neft in an exploration project for two large blocks, Leskinsky and and Pukhutsayakhsky, located in the north and northeastern parts of the Gydan Peninsula in East Siberia that together occupy an area of about 3800 square kilometres.

Additionally, Shell and Gazprom Neft continue to discuss terms of Shell's entry into a project to explore and develop the Ayashsky offshore block in Sakhalin, far eastern Russian, where the Russian company had made several discoveries.

Blue hydrogen options

Besides considering CCUS options for these projects, both companies will discuss the possibility of using technology solutions for the production of blue hydrogen via steam reforming of natural gas coupled with carbon capture, Gazprom Neft said.

Gazprom Neft chairman Alexander Dyukov said at the economic forum on Friday that the company has expertise in producing hydrogen via steam reforming at its refineries, and so sees this process as a prime opportunity to meet the potential growth of demand for this fuel.

The oil producer has also signed a separate MoU with the country’s leading steel smelter, Severstal, to consider introducing hydrogen into the production process to reduce the carbon footprint.

“Provided both parties are interested,” this could include altering these processes to use a methane-hydrogen mixtures instead of methane, a predominant component of natural gas, and coal, a joint statement from both companies said.

Severstal added that it has also signed an MoU with the country's largest gas independent, Novatek, to consider launching a joint pilot project for the production of blue hydrogen.