Oil-dollar era is officially over- Russia has conducted the first sale of oil in a currency other than U.S. dollar
On August 27, 2014 a major changed occurred on how oil and gas are purchased throughout the world. Russia is now accepting both Roubles and Yuan for the exchange of oil and gas products.
RIA Novosti
MOSCOW- The Russian oil company Gazprom Neft has agreed to export 80,000 tons of oil from Novoportovskoye field in the Arctic; it will accept payment in rubles, and will also deliver oil via the Eastern Siberia-Pacific Ocean pipeline (ESPO), accepting payment in Chinese yuan for the transfers, the Russian business daily Kommersant reported Wednesday.
The Russian government and several of the country’s largest exporters have widely discussed the possibility of accepting payments in rubles for oil exports.
Last week, Russia began to ship oil from the Novoportovskoye field to Europe by sea. Two oil tankers are expected to arrive in Europe in September. According to Kommersant, the payment for these shipments will be received in rubles.
Gazprom Neft will not only accept payments in rubles; subsequent transfers via the ESPO may be paid for in yuan, the newspaper reported.
According to the newspaper, the change in currency was made because of the Western sanctions against Russia.
In March, in response to Crimea’s reunification with Russia, the United States and the European Union introduced a number of targeted sanctions against Russia.
As the Ukrainian crisis escalated, the United States introduced several new rounds of sanctions targeting Russia’s defense, energy and banking sectors, and persuaded its allies to blacklist several Russian citizens and companies.
As a protective measure, Russia decided to avoid making its payments in US dollars, which can be tracked and controlled by the United States government, Kommersant reported.
Gazprom Neft gained control over the Novoportovskoye field in 2012. The field’s recoverable reserves exceed 230 million tons of oil and 270 billion cubic meters of gas. It is located in the Arctic and is part of the Yamal-Nenets Autonomous District.
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Gazprom Neft
JSC Gazprom Neft is a vertically integrated oil company engaged primarily in oil & gas exploration and production (E&P), the sale and distribution of crude oil, and the production and sale of petroleum products.
The company’s proven hydrocarbon reserves according to SPE (PRMS) criteria stand at 1.34 billion tonnes of oil equivalent (toe), placing it among the world’s 20 largest oil companies.
JSC Gazprom Neft operates in Russia’s major oil and gas regions, including Khanty-Mansi (Yugra) and Yamalo-Nenets Autonomous Areas, and Omsk, Orenburg, and Tomsk Regions. JSC Gazprom Neft’s major refining facilities are in Moscow, Omsk, and Yaroslavl Regions, and it also has refineries in Serbia. In addition, the company is involved in international E&P, including projects in Iraq, Venezuela, and elsewhere.
The company exports to more than 50 countries and distributes its products for sale through an extensive network of outlets in Russia and abroad. JSC Gazprom Neft currently has almost 1,750 petrol stations in Russia, the CIS, and Europe.
JSC Gazprom Neft’s largest shareholder is Gazprom, which owns 95.68% of the company’s shares. The remaining shares are in free circulation.
Source: Gazprom Neft
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Gazprom is a global energy company. Its major business lines are geological exploration, production, transportation, storage, processing and sales of gas, gas condensate and oil, sales of gas as a vehicle fuel as well as generation and marketing of heat and electric power.
What is natural gas
Gazprom views its mission in reliable, efficient and balanced supply of natural gas, other energy resources and their derivatives to consumers.
Gazprom holds the world’s largest natural gas reserves. The Company’s share in the global and Russian gas reserves makes up 18 and 72 per cent respectively. Gazprom accounts for 14 and 74 per cent of the global and Russian gas output accordingly. At present, the Company actively implements large-scale projects aimed at exploiting gas resources of the Yamal Peninsula, Arctic Shelf, Eastern Siberia and the Far East, as well as hydrocarbons exploration and production projects abroad.
Gazprom is a reliable supplier of gas to Russian and foreign consumers. The Company owns the world’s largest gas transmission network – the Unified Gas Supply System of Russia with the total length of over 168 thousand kilometers. Gazprom sells more than half of overall produced gas to Russian consumers and exports gas to more than 30 countries within and beyond the former Soviet Union.
Gazprom is the only producer and exporter of liquefied natural gas in Russia.
The Company is among Russia’s five largest oil producers and it is the largest owner of power generating assets in the country. These assets account for 17 per cent of the total installed capacity of the national energy system.
Source: Gazprom
