Rosneft Ships First Crude From $157 Billion Vostok Oil Project
Russia Vows to Keep Selling Oil to India Despite U.S.
Tariff Threat ExxonMobil and ConocoPhillips remain reluctant… What I Cover Irina Slav has been writing about global energy markets since 2007, covering the oil and gas industry, energy security, commodities, and the… Rosneft has shipped the first crude oil cargo from the Vostok Oil project in Eastern Siberia, despite sanctions targeting Russia’s energy industry and the exit of Western business partners.
At peak capacity, the project is expected to produce between 50 and 100 million tons of crude annually.
The Vostok Oil project is Russia's largest new oil development, comprising a group of fields in Krasnoyarsk Krai, some already producing and the rest new discoveries.
A total of 2,000 wells have been drilled at the site, Rosneft’s chief executive Igor Sechinsaid, adding that the fields have combined reserves of some 7 billion tons of low-sulfur crude.
The Vostok Oil project had an estimated price tag of the ruble equivalent of$157 billionback in 2019.
At the time, Rosneft had Western partners in the project, including Trafigura and Vitol, betting on continued strong demand for oil despite the political shift in favor of electrification.
The total costs associated with the operation of the fields over their productive lifetime were estimated at $170 billion back in 2021.
“The world consumes oil, but is not ready to invest in it,” Sechin said back then in a keynote speech, warning that Big Oil’s low-carbon plan to reduce oil and gas exploration and production would lead to a deficit of supply.
“This trend [of low upstream investment] may become a ‘new norm’ for global majors and result in resource base depletion.
The world runs the risk of facing an acute deficit of oil and gas,” Sechin said at the time, echoing a sentiment later often shared by OPEC partners.Related: American and African Crudes Soar as China's Oil Imports Rebound Given the substantial price tag of the development it made sense to get some Western oil majors on board to share some of the cost.
With the war in Ukraine and the Western sanctions against Russia, the commodity trading majors pulled out, as did TotalEnergies from Novatek’s LNG projects, but the projects themselves did not get shelved.
| Product | Price | Change |
|---|---|---|
| Brent Crude | $102.14/bbl | +0.34% |
| WTI Crude | $96.90/bbl | +0.21% |
| EN590 Diesel | $846/MT | +0.18% |
| Jet Fuel A-1 | $1090/MT | +0.55% |
| Mazut M100 | $450/MT | -0.15% |
| Bitumen 60/70 | $470/MT | +0.08% |
| Sulphur Gran 99.5% | $470/MT | -0.44% |
| Urea 46% Gran | $650/MT | +1.12% |
| NPK 16-16-16 | $460/MT | -0.28% |
| Nat Gas TTF | $15.42/MMBtu | +0.92% |
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