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UPDATE 1-Gazprom Neft says Shell suspends Russian tight oil project -Interfax

Fri, 03rd Oct 2014 13:56

(Adds detail, Shell comments)

MOSCOW, Oct 3 (Reuters) - Oil major Shell hassuspended development of hard-to-recover oil in Russia'sBazhenov formation with Gazprom Neft, Interfax citedGazprom Neft's head as saying, after the West imposed sanctionson Russia over Ukraine.

Last month the United States banned its firms fromsupporting exploration and production activities in deep water,Arctic offshore and shale projects with top Russian natural gasproducer Gazprom, its oil arm Gazprom Neft, Lukoil, Surgutneftegaz and Rosneft.

"We continue work ... by ourselves," Alexander Dyukov saidon Friday, according to Interfax, referring to Shell'ssuspension of development in the two companies' joint venture inwestern Siberia.

An estimated 75 billion barrels of technically recoverableshale oil resources may lie in the Bazhenov formation, accordingto the U.S. Energy Information Administration, more than in theUnited States, the world's leading shale oil producer.

"There are implications for some of Shell's current andenvisaged activities in Russia, including Bazhenov, and we areworking closely with relevant authorities and our partners todetermine what the exact impact of those will be," Shell said ine-mailed comments.

Shell continues working on other projects that aredeveloping conventional oil in Russia including its Salym jointventure with Gazprom Neft.

Last month, ExxonMobil said it was winding down itsoperations in offshore Arctic areas jointly with Rosneft becauseof sanctions. (Reporting by Vladimir Soldatkin; Editing by Alexander Winningand Jane Baird)

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