Rosneft acquires additional stake in Itera Oil and Gas for $2.9bn

Russian state-controlled oil company Rosneft has acquired the remaining 49% interest in Itera Oil and Gas Company for $2.9bn.

Rosneft’s share in Itera Oil and Gas is now 100%.

The acquisition allows Rosneft to increase gas production to 100 billion cubic metres (BCM) per annum and accelerate the development of the Kynsko-Chaselsk group of fields.

In August 2012, Rosneft and Itera Oil and Gas signed a deal to form a joint venture (JV) to produce and sell gas.

As part of the deal, Rosneft acquired a 51% stake in the JV in exchange for a 100% interest in the charter capital of Kynsko-Chaselskoye Neftegaz and $173.4m in cash.

The JV holds approximately 427.2 BCM of gas and 25.8 million tonnes of liquid hydrocarbons. It plans to produce around 13 BCM of gas this year.

Rosneft president Igor Sechin said that the gas business is one of the top priorities for the company.

"Consolidation of Itera Oil and Gas Company LLC will have a significant multiplier effect on our future growth and generate additional synergies, which will ultimately increase the total capitalisation of the company and bring additional value to shareholders," he said.

Itera Holdings owner Igor Makarov said that the company will continue to cooperate with Rosneft.

"There is a number of international and other projects with a potential of further development," he said.

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Image: Rosneft president Igor Sechin and Itera Holdings owner Igor Makarov. Photo: courtesy of Rosneft.