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Rosneft today

Igor Sechin Took Part in Russian-Indian Talks

11 December 2014
Photo: the Presidential Press and Information Office

On December 11, Rosneft Head Igor Sechin took part in the talks between the President of the Russian Federation Vladimir Putin and the Prime-Minister of India Narendra Modi in New Delhi.

As part of the negotiations Rosneft and Essar signed key terms of oil and oil products supplies to Essar refineries in India. Supplies may begin in 2015. The document envisages supplies of10 mln tons PA for a period of 10 years already in 2015 with a renewal option. Consequently Rosneft expands its distribution area and builds up deliveries to the region, where the world’s economy growth zones are concentrated. The document was signed by Igor Sechin and the Founder of Essar, Mr Shashi Ruia in the presence of the President of the Russian Federation Vladimir Putin and the Prime-Minister of India Narendra Modi.

Photo: the Presidential Press and Information Office

The reached agreement opens new horizons of cooperation between the two countries, thanks to the synergistic potential of the partnership in Upstream and Downstream areas of two leaders of the oil and gas industry of Russia and India. Thanks to this agreement Rosneft grants itself a secure market outlet of oil and oil products, while Essar gains a reliable and stable partner as a supplier of oil and oil products to its refining facilities.

Commenting on the signing Igor Sechin said: “The strategic potential of reached agreement between Rosneft – a global leader of hydrocarbon production – and Essar – a world’s leading player in the refining area – can hardly be overestimated. The performance of the terms of the agreement will have a substantial impact on the scale of economical cooperation between Russia and India and will fuel significant growth in the goods turnover between two countries. For our Indian partners the signing of this agreement represents a vital element of basic supplies diversification which, at the same time, will ensure energy security for the country. The Russian counterpart, in turn, will get the possibility of production and supplies volume planning to a new region with considerable growth potential”.

In his turn Shashi Ruia said: “We are very happy to partner Rosneft, a global leader in hydrocarbon reserves and production, for long term supply of crude oil and products. This provides good long term raw material security to our refineries”.

Igor Sechin emphasized that the visit of the Russian President to India has a strategic nature and is considered historical by the business society, given that for the first time in the history of Russian-Indian relations the signing of a long-term contract for oil supplies to India.was agreed Rosneft Head noted that the Company continues talks not only with Essar but with the other major refining companies, such as Reliance and ONGC. ONGC and Rosneft already cooperate in several upstream projects including those on Russian territory. Rosneft continues negotiations with ONGC about a possibility of increasing Indian companies’ participation in upstream projects. “As a matter of fact we are talking about an energy bridge between Russia and India” – Igor Sechin concluded.

As part of the working out the contract for oil and oil products supplies with the Indian company Essar Group Igor Sechin paid a visit to the refinery in Vadinar and held talks with the management of the company. Rosneft delegation reviewed the infrastructure of the refinery: the shipping port, the export jetty. The Vadinar refinery is located on the West coast of India, production at the facility began in 2008. Essar Oil owns India’s second largest single site refinery having a capacity of 20 MMTPA and complexity of 11.8, which is amongst the highest globally.

The parties emphasized the potential for developing relations between Rosneft and Essar. Igor Sechin identified possible areas of cooperation, among other things in the area of oil supplies.

Notes for editors:

Essar Global Fund Limited (Essar) is an investment fund managed by its investment manager, Essar Capital Limited. The Fund is a global investor, controlling a number of world-class assets diversified across the core sectors of Energy, Metals & Mining, Infrastructure (comprising ports and EPC businesses) and Services (primarily comprising shipping and BPO businesses). The aggregated revenues of the Fund’s portfolio companies total US$35 billion. The Fund’s portfolio companies employ over 60,000 people across 29 countries, and have adopted international standards of health, safety, environmental protection and corporate governance.

Essar Oil Limited, one of the assets in the energy portfolio of Essar, is a fully integrated oil & gas company of international scale with strong presence across the hydrocarbon value chain from exploration & production to refining and oil retail. Essar Oil owns India’s second largest single site refinery having a capacity of 20 MMTPA and complexity of 11.8, which is amongst the highest globally. It has a portfolio of onshore and offshore oil & gas blocks with about 1.7 billion barrels of oil equivalent in reserves & resources. There are more than 1,700 Essar-branded oil retail outlets in various parts of India.

Rosneft and ONGC cooperate within the Sakhalin-1 project since 2001 (ONGC acquired a 20% stake in the Sakhalin-1 project from Rosneft).

The Sakhalin-1 project is implemented on the terms of Production Sharing Agreement (effective since 1996) and comprises three fields (Chaivo, Odoptu and Arkutun-Daghi) on the north-eastern shelf of Sakhalin Island.

Project stakeholders are:

  • Exxon Neftegas Limited – 30%;
  • SODECO – 30%;
  • Rosneft – 20%,
  • ONGC – 20%.

Rosneft Information Division
Tel.: + 7 (499) 517-88-97
December 11, 2014