Total to pare Russia upstream oil presence
Total plans to sell a 20pc stake in Kharyaga in a deal that may be announced later this month although the operatorship transfer to the Russian firm could take up to several months. Kharyaga — the smallest of Russia's three PSA projects — is Total's only crude producing asset in Russia. It currently controls a 40pc stake in Kharyaga, with Norway's Statoil holding 30pc, and Zarubezhneft 20pc, while the remainder belongs to regional producer Nenets Oil. But production at the 412mn bl Kharyaga field has been in decline lately and the authorities have been unhappy with the French firm's performance as operator of the project.
At the beginning of this year Total came under fire from the energy ministry, which oversees PSA projects, over its failure to meet crude production targets and equip the field with associated gas facilities.
Previously, it was criticised for inability to lift output to levels envisaged by the PSA terms — something that it blamed on a lack of transportation capacity and complex geology.
Total signed its PSA for 29 years in 1999 and at one point forecast that the field would yield 70,000 b/d by 2013. But lately the firm has been focusing on maintaining it at 30,000-35,000 b/d.
US and EU sanctions targeting shale oil projects in Russia meant the firm had to pull out of a partnership with Lukoil, impeding plans to expand Total's crude production in Russia.
Total is the largest foreign investor in Russia's energy sector. It is currently preparing for the commissioning of Yamal LNG. With Russian firm Novatek, Total started gas and condensate production at the 47.3bn m? Termokarstovoye field in Yamal-Nenets district in May.
Total and Zarubezhneft declined to comment on the plan to sell a stake in Kharyaga.