Russ Oil-Gas

03-03-2009 - Business Day - Russia’s Gazprom hopes to conclude a $2.5 billion oil and gas exploration deal with Nigeria by the end of March, establishing a 50/50 joint venture with state oil firm Nigeria National Petroleum Corporation (NNPC). “We are one month away from getting a conclusion on the Joint Venture (JV) deal,” Vladimir Ilyanin, managing director of Gazprom Nigeria, told an oil and gas conference in the Nigerian capital Abuja last Wednesday. NNPC said in September it had signed a Memorandum of Understanding (MoU) with the Russian gas export monopoly on joint venture projects, but gave few details. The corporation said at the time that the deal covered petroleum and gas exploration, as well as power. Nigeria has the world’s seventh-largest proven gas reserves, but has been unable to develop its gas industry to anywhere near full potential because of lack of funds and regulation. Some industry experts in Europe see Russia’s deals with African OPEC members like Nigeria as an attempt to increase control on Europe’s natural gas supplies. Gazprom already provides a quarter of Europe’s gas. A senior Gazprom source told Reuters three weeks ago that the Russian firm wanted to invest at least $2.5 billion in the development and production of Nigerian gas, a figure confirmed by Ilyanin. The source added that 90 percent of the investment would be in developing Nigeria’s domestic gas production, processing and transportation.