Exxon Mobil Corp. (XOM) agreed to develop tight oil reserves in
Western
Siberia
and open a research center with Russian oil and gas company Rosneft
(ROSN.RS) as part of an effort to find new regions of operation and explore the
potential of difficult-to-produce reserves.
Exxon Mobil and Rosneft agreed to expand efforts to develop oil reserves in
tight, low-permeability formations in
Western Siberia
using
technology advancements that Exxon Mobil has successfully deployed in
North
America
.
The pact includes provisions for a pilot program to determine the technical feasibility
of developing the reserves and is an extension of the research program the two
companies signed in April.
The companies also plan to approve a work program for selected Rosneft license
blocks that will include geological studies of and drilling in the Bazhenov and
Achimov reservoirs.
Exxon Mobil, the world's largest publicly traded oil company by market value,
will finance the geological studies and exploratory drilling, which is expected
to begin in 2013.
The two companies also agreed to establish a joint
Arctic
Research
Center
for
Offshore Developments. The center will provide services to support all stages
of oil and gas development on the Arctic shelf, including the design of ice
resistant offshore vessels, structures and Arctic pipelines.
Both initiatives are a part of a long-term strategic cooperation agreement the
two companies signed in August.
Exxon Mobil reported its first-quarter earnings fell 11% on reduced production
and sales volumes, as well as higher operating expenses at its exploration and
production business. The company, which has bet heavily on natural-gas
production in recent years, was expected to see profit drop because prices for
the commodity had hit decade-low levels.
The company's oil production fell 7.7%, largely due to the effect of
production-sharing contracts. Exxon's production decrease shows that some major
U.S.
oil
companies continue to struggle to increase their output as the reserves in
their fields deplete and access to new sources remains a challenge.
Shares of Exxon Mobil rose 0.2% to $82.32 in recent premarket trading. The stock is down 3% so far
this year.