That implies that the deal was worth more than $7 billion - making it Trafigura’s largest ever acquisition by far - and valuing the 10% stake in Vostok Oil at roughly the same level as the book value of Trafigura itself. In addition to the loan for a fully owned Trafigura entity CB Enterprises Pte Ltd., through which it bought the stake, the trading house invested a small amount of its own funds, according to a person familiar with the transaction, who asked not to be named discussing sensitive information. The investment runs counter to the reluctance among many Western majors and investors to back big new oil projects, especially in environmentally fragile areas like the Arctic. The documents offer the first official indication of the scale of Trafigura’s bet on the sprawling project, which Rosneft Chief Executive Officer Igor Sechin has said could produce 1 million barrels of oil a day by 2027.
Trafigura had said the purchase had been “majority financed by long-term debt,” but didn’t name the lenders.Īccording to corporate filings in Singapore, which haven’t previously been reported, the trading firm agreed to a 5.775 billion-euro ($7 billion) loan facility with Credit Bank of Moscow PJSC on Dec. The two companies last week said they had completed a deal for a 10% stake in Vostok Oil, without providing a value. CPC declined to comment.(Bloomberg) - Trafigura Group’s purchase of a stake in Rosneft PJSC’s flagship Arctic oil project was funded by a $7 billion loan organized by a Russian bank, according to documents that shed new light on the trading house’s biggest-ever deal. Rosneft has previously estimated that Vostok Oil, which will start production later this decade, would require more than 10 trillion roubles ($135 billion) in investments.Īfter a call with Rosneft, several analysts had said last year Rosneft planned to sell some 'brownfields', or mature assets, in southern Russia, along with underperforming brownfields elsewhere, to raise capital to develop Vostok Oil.Īfter the sale, Rosneft is expected to keep exports of gas condensate via CPC at least until the end of 2021, sources said.Ī joint venture between Rosneft and Royal Dutch Shell owns a 7.5% stake in CPC and there are no plans to sell it for now, sources added. Rosneft and Cengeo did not respond to requests for comment from Reuters. CPC pipeline ships Kazakh and Russian oil to the Black Sea.Ĭengeo, a private Russian company which focuses on mature oil fields, has already bought a 51% stake in Ingushneft and was expected to buy Stavropolneftegaz and Dagneft by the end of May, two sources said. Rosneft was selling its southern Stavropolneftegaz, Ingushneft and Dagneft with combined oil output of about 1 million tons per year, a fraction of the 205 million tons it pumped in 2020 (4.1 million barrels per day), four industry sources familiar with talks said.Ĭrude oil from Stavropolneftegaz, Ingushneft and Dagneft is exported via Caspian Pipeline Consortium (CPC) system, in which Rosneft holds a minority stake. Bakken oil province over the past decade. Vostok Oil, in which global commodities trader Trafigura has a 10% stake, is one of Russia's biggest oil projects, comparable in size with the exploration of West Siberia in the 1970s or the U.S.
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