MOSCOW, April 13 (Reuters) - International energy major
Shell has decided not to complete a deal on a Russian
Arctic oil joint venture, Meretoyakha Neftegaz, it was expected
to enter with Gazprom Neft, because of some "external"
factors.
Total resources at fields of Meretoyakha Neftegaz were
valued by Gazprom Neft at 1.1 billion tonnes (over 8 billion
barrels of oil).
The decision has been taken against the background of
falling global investments into energy projects over weak oil
and gas demand and prices amid the global economic downturn,
overproduction and the spread of the coronavirus.
"Due to challenging external environment Shell will not
pursue the completion of the deal to create a joint venture on
the basis of Meretoyakha Neftegaz," Shell said in a comment sent
to Reuters.
The Yamal region is key for Russian oil and gas production.
It accounts for more than one fifth of global natural gas
reserves.
The deal, to set up a 50/50 joint venture to tap oil in the
Yamal-Nenets region was signed in summer 2019 at a Russian
business forum. It was expected to be completed by early 2020.
Gazprom Neft said it would pursue the development of the
project alone.
Both companies are still involved in another oil project in
Russia, Salym Petroleum Development.
(Reporting by Vladimir Soldatkin and Olesya Astakhova; editing
by Grant McCool)
