Russia's state oil champion Rosneft signed a major new Arctic deal with Italy's ENI on Wednesday as it sought to build on the global success of its historic alliance with US super-major ExxonMobil.
ENI chief executive Paolo Scaroni said Rosneft would in exchange gain access to some of the Italian firm's European and US projects under a strategic tie-up covering specific Barents Sea and Black Sea fields.
"It is important that we expand our cooperation to projects in the United States and Europe," Russian news agencies quoted the ENI boss as saying at a signing ceremony attended by Russian president-elect Vladimir Putin.
No financial details were immediately disclosed by either party but Rosneft chief Eduard Khudainatov said the two firms' joint investment may eventually top $100 billion.
ENI said the three Russian fields in the deal contained 36 billion barrels of oil equivalent -- the same figure as the Arctic projects won by ExxonMobil in its multi-billion-dollar tie-up sealed with Rosneft last week.
"This is a very large and long-term project that involves big investments," Putin said in televised remarks.
Putin's personal blessing has been essential for any major group deciding to bet big on Russia -- a country where some Western firms have fought for the right to control the energy they produce.
The veteran Russian leader will assume his third Kremlin term next month and has previously promised to devote special attention to joint ventures that could help the state finally tap the country's abundant Arctic reserves.
"I want to assure you that the Russian government will do everything to support projects of this kind," Putin said.
The deal offers ENI immense opportunities while also weighing it down with massive new investments and risks.
ENI will own a third of a venture to develop two fields that Rosneft owns in its Barents Sea section of the Arctic but it will have to cover the entire $2-billion expense of the accompanying natural gas exploration work.
The Italian giant will also gain partial rights to the problem-prone Val Shatskogo field in the Black Sea that Chevron abandoned last year after finding it much too complicated and expensive to exploit.
Rosneft was a small and struggling state unit until it picked up a prized field of the now-defunct Yukos oil giant at a discounted 2004 state auction that immediately propelled it into the leading ranks of Russian oil.
It now controls about one-fifth of Russia's oil production and some of the world's most coveted reserves in the Arctic -- an area of emerging strategic importance amid the continuing volatility in the Middle East.
"We are turning another page in our history," news agencies quoted Rosneft's Khudainatov as saying.
The tie-up is very similar to ExxonMobil's in structure and underscores an emerging pattern to how Russian state companies intend to trade in their Arctic rights for new technology and Western market access.
ENI promised to provide Rosneft with the offshore drilling expertise needed to develop the prohibitively difficult Arctic and western Black Sea fields that the Russian firm is unable to tackle on its own.
Scaroni said ENI would probably first invite Rosneft to join its existing North Africa projects before expanding the list to deals in the continental United States and Alaska as well as parts of Europe.
"We have started to discuss areas of mutual interest to both sides," the ENI boss said in comments suggesting that more detailed negotiations were still under way.
Rosneft's Khudainatov said the two sides' joint investment in the two Arctic projects may reach $70 billion. It also outlined various exploration and initial drilling work that would take another 14 years to complete.
The Russian firm reported no initial oil production date while putting the Black Sea investment cost at $50-55 billion.