Last April, Russia and Norway came to an agreement on the delimitation of the maritime border between their two countries in the Barents Sea, ending a forty year dispute. Now at this year’s St. Petersburg International Economic Forum, the two countries’ main gas producers, Gazprom and Statoil, have signed a science and technology agreement to cooperate in the Barents Sea. Gazprom is the largest natural gas producer in the world while Statoil isĀ  the largest offshore oil company in the world, making for a powerful combination.

A press release on Statoil’s website states that the two companies will cooperate in the following areas:

  • Geological exploration and development of hydrocarbon fields
  • Hydrocarbons production and treatment before transportation
  • Technologies and equipment for the hydrocarbons transportation
  • Environmental protection of the Northern seas and territories
  • Health, Safety and Environment issues under northern condition
  • Energy saving and renewable energy sources
  • Gas processing
  • Project management and corporate governance

It’s nice to see that environmental protection has made the list, but let’s hope that both companies make a real commitment to this issue so that a repeat of the Deepwater disaster doesn’t happen in the Arctic.

This science and technology agreement builds on the memorandum of understanding signed between the two entities in July 2009. Gazprom and Statoil are partners in developing the Shtokman Field in the Barents Sea, which holds an estimated 3.8 trillion cubic meters of natural gas and 37 million tons of gas condensate.

The Barents Observer notes that this agreement between Gazprom and Statoil finally makes good on a wish expressed by USSR Premier Mikhail Gorbachev in a speech given in Murmansk, still the Arctic’s largest city, in October 1987 as the Cold War was coming to a close. He said,

“The Soviet Union attaches much importance to peaceful cooperation in developing the resources of the North, the Arctic. Here an exchange of experience and knowledge is extremely important. Through joint efforts it could be possible to work out an overall concept of rational development of northern areas. We propose, for instance, reaching agreement on drafting an integral energy programme for the north of Europe. According to existing data, the reserves there of such energy sources as oil and gas are truly boundless. But their extraction entails immense difficulties and the need to create unique technical installations capable of withstanding the Polar elements. It would be more reasonable to pool efforts in this endeavour, which would cut both material and other outlays. We have an interest in inviting, for instance, Canada and Norway to form mixed firms and enterprises for developing oil and gas deposits of the shelf of our northern seas. We are prepared for relevant talks with other states as well.

Perhaps this agreement can be a lesson for other countries still disputing their maritime borders, such as some of the Southeast Asian nations around the resource-rich Spratly Islands like China, Vietnam, and the Philippines. When borders are delimited, countries can finally begin reaping the economic benefits of the sea, and do so through bilateral or multilateral cooperation.

News links

“Statoil and Gazprom sign technology agreement,” Barents Observer

Categories: Oil & Gas Russia

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