Rosneft, GE form Russian engineering partnership
Rosneft and General Electric (GE) have agreed to set up a series of joint ventures, with emphasis on expanding the science and technology cooperation between the companies.
The first phase of the partnership would involve the creation of two specialized research and training centers, with investment of up to $400 million through 2020.
One center, known as the application engineering and training center, will focus on the development of Rosneft projects through the application of the broad GE Oil & Gas portfolio of products and technologies.
The key functions of the center will include the cooperation between Rosneft and GE to build and upgrade Rosneft oil and gas projects, including concept selection and support to project front-end engineering and design (FEED) work, equipment localization initiatives for Rosneft projects, and providing training on application engineering and other technical topics to enhance capabilities of Rosneft engineers and technical managers.
The center will focus its activity on the development of gas sales solutions, including LNG and CNG, power generation solutions, production enhancement including artificial lift technologies, offshore and subsea equipment, and refining and petrochemical technologies.
The second project, known as the research and development (R&D) center, will focus on the development of joint technologies and upgrading of existing technologies of the companies.
Top-priority activity areas of the R&D center will be gas monetization activities, refining and petrochemical, including GTL technologies and new polymers, offshore and subsea projects, including development of low temperature materials, and production enhancement.
The center will be responsible for providing an appropriate intellectual property ownership and licensing structure for the know-how and new joint technologies created as part of its activities.
The companies will initially contribute $20 million in investment to the centers on a parity basis, with additional aggregate financing of $50 million to be made by the companies upon the agreement of future, specific projects.
Rosneft and GE plan to jointly invest
up to $400 million in the centers through 2020.
We see great opportunities in the sustainable growth of the oil and gas sector in Russia, one of the largest in the world," said GE CEO Jeff Immelt. "We are pleased to build on our strategic partnership with Rosneft by signing an agreement focused on developing local expertise and technology solutions which will drive productivity and growth in the oil and gas sector in Russia.
Rosneft says the center will allow it to maintan efficient onshore production and to enhance Arctic and offshore shelf projects by implementing more sophisticated and safe technologies.
The implementation of the project will allow Rosneft and General Electric to create unique engineering and R&D technology hubs in Russia," said Rosneft president Igor Sechin.
"Critical to their mission will be the localization of equipment and service opportunities for Rosneft projects," he continued. "A project-based approach envisaged for the activities of the centers drastically increases the impact and efficiency of direct financing of science and technology projects critical to the development of the Russian economy. Moreover, the implementation of this agreement will create new jobs and train high-level
specialists for the needs of Rosneft and the Russian economy.
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