Russian oil company Lukoil and Italian energy company Eni have submitted a joint bid for offshore blocks Marine 24 and Marine 31 in the Republic of the Congo, according to Lukoil's vice-president for America, Africa, and the Middle East, Ivan Romanovsky.
Romanovsky said the projects would be operated under a production sharing agreement between the two energy giants, adding that Lukoil's share in the business could reach 43 percent.
He clarified that the Congolese government has already accepted the joint application for the operation of the two blocks, adding that the sides are at present in the process of discussing the agreement's final commercial terms.
"It should be noted that technically, we were recognized as the winners in these applications because we were the only companies that applied for the acquisition of these blocks," Romanovsky added.
Lukoil is at present operating in the Republic of the Congo as a member of the Marine XII oil and gas project, where the Russian company holds a 25 percent share. The project also involves the Italian Eni as the project’s operator (65 percent) and the National Petroleum Company of Congo (10 percent).
Romanovsky stressed that oil production at the Marine XII project can be increased to 1.7Mln tons from 1Mln tons per year, and gas production is expected to jump up to 5.5Bln cubic meters from the current 1.5Bln cubic meters per year.
"At the moment, the Marine XII project produces 1Mln tons of oil and 1.5Bln cubic meters of gas per year. At the next stage of development, a shelf of 1.7Mln tons of oil and 5.5Bln cubic meters of gas is planned," he said.
Romanovsky added that Lukoil had already invested $955Mln in Marine XII, including the acquisition of a 25 percent stake in the project from the British company New Age M12 Holdings Limited in 2019.
"We plan to invest another $1Bln. The total investment for Marine XII will be $1.96Bln," the vice-president said.
The Lukoil executive also announced that the first production of liquefied natural gas (LNG) on a floating unit as part of the Marine XII project is set to start in December 2023, adding that the liquefaction capacity will be 600,000 tons per year.
Romanovsky added that in the future it is planned to expand the LNG production capacity by another 2.4Mln tons because of the commissioning of a second floating unit.
"Thus, at the end of 2025, the total liquefaction capacity will be 3Mln tons per year," the vice-president added.
Competence in gas liquefaction, as Romanovsky noted, is a new milestone in the history of Lukoil, and it provides opportunities for the implementation of such projects both in the Congo and in a number of other countries where the company operates.
Lukoil's vice-president also stressed that Eni would be responsible for delivering gas from the Marine XII project.
"Sales markets will depend on the situation that will develop the moment we have volumes of liquefied gas," Romanovsky concluded.
Aside from the Republic of the Congo, Russian oil company Lukoil operates in several countries in the African continent, including Egypt, Ghana, Cameroon, Nigeria, and Cote d'Ivoire.
Earlier in the week, Russian Ambassador to the Republic of the Congo Georgy Chepik revealed that Moscow and Brazzaville are developing a project to create a petroleum product pipeline between the largest cities of the Congo Republic – Pointe Noire and the capital Brazzaville. According to the diplomat, an agreement on the pipeline's construction is expected to be signed before the upcoming Russia-Africa Summit, which is set to take place in Saint Petersburg, Russia, in July.
Chepik added that Russia's ZNGS Prometey pipeline construction, repair, and maintenance company has shown interest in the project.
The head of the Russian diplomatic mission also drew attention to the fact that Lukoil, which has been operating in the African country since 2019, is the leader in developing economic relations between Russia and the Republic of the Congo.