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. Last Updated: 07/27/2016

Shell, Evikhon Plan Siberian Project

Royal Dutch/Shell unit Shell Salym Development BV and the Russian oil company Evikhon formed a joint venture Wednesday to develop and operate oil fields in Western Siberia, company officials said.

But they said the venture's future would depend on the implementation of Russia's controversial production-sharing law, approved last December, which envisions attracting tens of billions of dollar in foreign investments.

"We want to start working as soon as possible," said Alan Parsley, a director of new business development at Shell International Exploration and Production.

"But we have great concerns over profits, and we must be sure of the commercial conditions. We must first bring laws in line with Russia's production-sharing law, to have negotiations with the government," he said.

The production-sharing legislation was revised by parliament, and foreign oil firms have said it remains a far cry from what they had hoped to see.

The joint venture, Salym Petroleum Development NV, plans to work the Upper Salym, West Salym and Vadelyp oil deposits in the Khanty-Mansiisk autonomous region.