State-owned Gazprom Neft and independent Novatek plan to join forces to explore frontier waters in Russia's Far East, writes Vladimir Afanasiev.

Gazprom Neft's executive board chairman Alexander Dyukov said that months of talks between the two companies has resulted in Novatek picking up the North Vrangelevsky block as a target for joint work.

This block measures over 110,000 square kilometres and lies to the northwest of Wrangel Island in the East Siberian Sea.

Novatek executive board chairman Leonid Mikhelson has been quoted as saying that the partners intend to bankroll the gathering of 3D seismic and drilling of two exploration wells on the acreage, with work to begin next year.

So far, Gazprom Neft has been shooting only 2D seismic on the acreage, reportedly gathering some 5000 kilometres of data in 2018, and is gearing to collect at least 7000 kilometres of additional 2D data before the end of this year.

Because of the remote location of the asset, Russian authorities last year permitted Gazprom Neft not to rush its exploration campaign, with the amended licence for the block allowing the company to wait until as late as 2037 to start work on any potential commercial hydrocarbon development.

Gazprom Neft and Novatek are already partners in two onshore gas joint ventures in West Siberia, called ArcticGaz and Northgaz.

Weekly

Russian pair join forces