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. Last Updated: 07/27/2016

Gazprom Deals With Italian Firm

Russian gas giant Gazprom is set to sign a major deal with Italian energy company ENI on Wednesday, the next phase of an already unrivaled network of partnerships with European companies.

Gazprom head Rem Vyakhirev described the coming deal as analogous to one signed in November with energy major Royal Dutch/Shell. The two firms agreed to create a joint company producing 500,000 barrels per day of hydrocarbons.

And he was qouted by Interfax as saying that he now holds out the possibility of a three-way alliance between Gazprom, Shell and ENI, which would greatly increase opportunities for its participants and create a "powerful global structure."

Gazprom is no stranger to foreign alliances, although most of its agreements before November's deal with Shell were in marketing gas abroad rather than producing fuels in Russia.

Shell and Gazprom said the first project they would undertake would be development of western Siberia's Zapolyarnoye oil and gas field.

Gazprom produced 534 billion cubic meters of gas in 1997. Exports outside the former Soviet Union stood at 117 bcm that year. Shell, with the second largest output globally, produces one eighth of Gazprom's total.