22 April 2015, News Wires – The French supermajor has held preliminary talks with state player and minority stakeholder Zarubezhneft about offloading its holding, Russian business newspaper Vedomosti reported.
The newspaper, which cited an unidentified federal official and source close to Zarubezhneft, said talks are at a preliminary stage.
Upstream awaits comment on the issue from Total.
Earlier this year reports suggested that Russian authorities were looking to remove Total’s operatorship from the project, something Energy Minister Aleksandr Novak later denied.
In January, reports emerged that authorities were unhappy with Total’s failure to achieve 95% utilisation of associated gas, and thus increase oil production as promised.
However, Novak revealed that authorities only asked Total to consider taking representatives of Zarubezhneft on board to assist in the task of building processing facilities to bring associated gas to market specifications.
In February 2011, Total said that it signed a $400 million engineering, procurement and construction contract with Russia’s Globalstroi¬engineering to update its central oil processing centre under the third phase of the production expansion project.
The contract included facilities to stop flaring associated gas by the end of the third phase.
However, the contractor has failed to perform, with Total and Russian authorities discussing a solution to amend construction plans and select a new contractor for the job, Novak said.
He added that Zarubezhneft representatives have sufficient “qualification and expertise” to advise Total on gas utilisation.
Total holds a 40% stake in the Kharyaga PSA, having in late 2009 sold a 10% stake to Zarubezhneft, which holds a 20% interest. Norway’s Statoil and Russia’s Nenets Oil have 30% and 10% shareholdings, respectively, in the development.