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Repsol, Alliance Oil complete first phase of E&P in Russia
Spanish oil major Repsol and independent energy firm Alliance Oil have completed the first phase of their joint venture for the exploration and production of hydrocarbons in Russia, both firms said in press releases on Friday. Repsol seeks to boost energy output, as part of its 2012-2016 investment plan.
Alliance has transferred its upstream subsidiary Saneco to the joint venture. Saneco holds brownfield upstream onshore assets in the Samara region of southwest Russia. The Samara assets produced 1.1 million barrels of oil in Q2 2012 and contain proven and probable reserves of 38 million barrels.
In return, Repsol has contributed USD 37m to the joint venture and acquired shares in it worth USD 36m. The Spanish giant now holds a 49 per cent stake in the venture, while Alliance holds the remaining 51 per cent.
The joint venture will also include Alliance’s subsidiary Tatnefteotdacha and Repsol's Eurotek, under the terms of an agreement signed last December by both firms. These subsidiaries are expected to be added in Q4 2012.
Alliance Oil is an independent energy company with several operations focused in Russia and Kazakhstan.
The aim is to combine Alliance Oil’s resourcefulness in terms of exploration and production opportunities in the region to Repsol’s technological know-how in order to further both firms’ expansion in the country, they said. Russia is the world's largest oil and gas producer.
The move is particularly key for Repsol. The firm seeks to reach a production target of 500,000 barrels of oil equivalent per day by 2016, as part of it ambitious EUR 19,000m 2012-2016 business plan.