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Rosneft and PDVSA sign major collaboration agreements to boost Venezuela’s oil production

30th July 2014

Rosneft president and chairman of the management board, Igor Sechin, and Venezuela’s minister of petroleum and mining and PDVSA president, Rafael Ramirez, signed a cooperation agreement to implement offshore projects in Rio-Caribe and Mejillones blocks (Phase II of the Mariscal Sucre Project), as well as seperate agreements to create a new engineering joint venture and pursue joint training programmes

Rosneft and PDVSA sign major collaboration agreements to boost Venezuela’s oil production
In the course of their negotiations, Rosneft and PDVSA agreed to extend the Petrovictoria JV Establishment and Operation Agreement with the purpose of prolonging the Carabobo-2 project entry bonus agreement

As part of the document, the parties express their interest to continue negotiations with the goal of reaching an agreement on key technical requirements, commercial and legal terms for the potential establishing of joint ventures to develop Rio-Caribe and Mejillones blocks in accordance with legislation of Venezuela.

The parties also held negotiations on LNG plant construction.

The parties also agreed to set up a joint venture (Engineering & Construction JV Establishment and Management Agreement) to engage in the activities in relation to well drilling, re-completion and well infrastructure development, as well as to provide any services related to the procurement of equipment, devices, materials and services within Rosneft / PDVSA joint projects.

This JV will enable expedited development of infrastructure for, and significantly enhance the efficiency of managing, Rosneft's Venezuelan assets.

In the course of their negotiations, Rosneft and PDVSA agreed to extend the Petrovictoria JV Establishment and Operation Agreement with the purpose of prolonging the Carabobo-2 project entry bonus agreement.

“Today we signed a series of agreements,” said Sechin. “I am pleased to note that our collaboration continues. To highlight, today we reached an agreement on setting up a service company for servicing production projects and promoting advanced technologies.

“Our agreement to set up a construction JV is equally important. Our cooperation is substantial and natural. The eight million barrels a day we produce is a material production level. This underpins the energy security of several countries. We are set to develop our cooperation.

“We are now working on a number of new agreements and I am confident we will come to terms. The bonus agreement will allow us to pay USD 440m which will serve to strengthen the Venezuelan economy”.

The two companies also signed an agreement to arrange the training of citizens of the Venezuela in Rosneft partner universities.

Rosneft will consider the possibility to cover training, accommodation costs and scholarships for graduates of Venezuelan educational establishments, who take part in the program. The company also intends to cover insurance costs, costs of travels to the place of training and back, and to address immigration formalities.

In particular, Rosneft proposes to arrange the training of Venezuelan citizens in the Russia State Oil and Gas University named after I.M. Gubkin in Moscow.

“Rosneft will continue to implement projects aimed at strengthening ties between Russia and Venezuela,” said Sechin. “I am confident that the company universities are able to train highly skilled specialists for petroleum industry.”

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