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. Last Updated: 07/27/2016

Rosneft Touts Potential in Kamchatka

Itar-TassPutin touring a submarine pier Wednesday in Vilyuchinsk, accompanied by Defense Ministry and military officials.
Rosneft plans to start drilling next year for oil and gas off the Kamchatka Peninsula, where reserves could rival those at Sakhalin, CEO Sergei Bogdanchikov said Wednesday.

Rosneft estimates that developing the Kamchatka shelf will cost about $24 billion, Bogdanchikov said in the Kamchatka town of Vilyuchinsk, which he was visiting with President Vladimir Putin, Interfax and RIA-Novosti reported.

"We've already prepared everything to begin work on two exploratory wells, and drilling will start in 2008," Bogdanchikov said. "The project's size is equal to Sakhalin-1 or Sakhalin-2, or even surpasses it."

During a meeting on the project, Putin criticized government officials for holding up the construction of a long-delayed gas pipeline on the peninsula, Itar-Tass reported.

"I understand that it's an unprofitable project for commercial companies, as Sergei Mikhailovich [Bogdanchikov] said," Putin said. "What has the government done? Don't you think [a delay of] seven years is intolerable? This is too long."

Putin was on his way to the Asian Pacific Economic Forum in Australia, which begins Saturday.

Unified Energy System chief Anatoly Chubais told the meeting that the utility planned to sign an agreement with the regional government by Dec. 1 to build the pipeline.

Rosneft, which has a 60 percent stake in the Kamchatka project, has so far invested around $90 million there and will inject $270 million to $300 million next year.

It is unclear whether the Kamchatka reserves are oil or gas, but Rosneft's partner Korean National Oil Corporation has previously said there could be up to 10.3 billion barrels of oil.

n During his Kamchatka visit, Putin toured a Navy base and played tenpin bowling with First Deputy Prime Minister Sergei Ivanov.

Television pictures showed the pair touring refurbished officers' accommodations at a submarine base in Vilyuchinsk, and playing volleyball and bowling at a newly built gym. Later they changed into camouflage outfits and inspected a fisherman's hut.

Reuters, Bloomberg, MT