Gazprom Neft launches shale oil production project

PanARMENIAN.Net - Gazprom Neft, the oil arm of energy giant Gazprom, has launched a project to develop shale oil production in Russia, the company said in a statement, according to RIA Novosti.

“In contrast to shale gas extraction, tight oil production is of considerable interest for Gazprom Group and we will work actively on this issue,” Gazprom CEO Alexei Miller said.

The Gazprom Neft board of directors discussed shale oil production in Russia last Friday after the company launched a joint project with Shell to develop the Bazhenov formation at the Upper Salym oilfield in West Siberia.

The deposit will be operated by Salym Petroleum Development (SPD), a 50-50 joint venture between Gazprom Neft and Shell.

“Experts of Gazprom Neft, Shell and SPD created a road map that defines the steps to achieve the main goal - the development of the Bazhenov formation on an industrial scale,” the statement said.

Shale oil hydrocarbons located in West Siberia in the Bazhenov, Abalak and Frolovskaya rock formations with ultra-low permeability but high oil saturation lie at a depth of more than 2 km (1.2 miles) and spread over more than 1 million square km.