In accordance with the co-operation agreement, Gazprom and Total will set up a special-purpose company to organize the design, financing, construction and operation of the Shtokman phase one infrastructure. The company will own this infrastructure for 25 years from field commissioning.
While Gazprom will hold a 75% participating interest in the company, Total will have 25%. Upon completion of phase one operations, Total will transfer its share to Gazprom. The agreement also provides for the possibility for other foreign partners to join the project with a participating interest of up to a 24%, at the expense of Gazprom’s share.
The first phase of development is intended to produce 23.7 billion cubic meters of natural gas per year. Deliveries of pipeline gas are expected to commence in 2013 and the first liquid natural gas (LNG) will be delivered in 2014.
The relationship between the special-purpose company and Sevmorneftegaz, the Shtokman license holder, of which Gazprom owns 100%, will be based on a contract under which the company will bear all financial, geological and technical risks related to the production of gas, condensate and LNG.
An agreement has been reached to start joint project implementation activities in July 2007. Gazprom will retain all marketing rights of the hydrocarbons to be extracted.
Alexey Miller, chairman of Gazprom’s management committee, said: The agreements we have reached represent another crucial step in the development of mutually beneficial co-operation and partnership between Gazprom and the world’s largest energy companies.
