Freshfields, Linklaters and Morgan Lewis advise as Rosneft teams with Statoil
3 September 2012 | By Ruth Green
7 May 2013
11 July 2013
29 April 2013
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24 February 2014
Freshfields Bruckhaus Deringer, Linklaters and Morgan Lewis & Bockius have all been retained as advisers as Russian state-owned energy giant Rosneft signed four new joint ventures to explore oil and gas fields in the Arctic and Pacific Oceans with Norwegian rival Statoil.
The deal will see the two companies jointly explore Rosneft’s estimated 100bn tonnes of untapped oil and gas reserves, comprising the Russian oil giant’s Perseevsky licence block in the Barents Sea and Kashevarovsky, Lisyansky and Magadan 1 licence blocks in the Sea of Okhotsk.
The deal was originally agreed via a cooperation agreement signed by the two companies on 5 May and will see Rosneft acquire a 66.67 per cent and Statoil a 33.33 per cent equity stake in each of the four joint ventures. Under the terms of the agreement, Statoil will finance 100 per cent of the costs in the exploration phase, which includes an obligatory programme of six wildcat wells to be drilled between 2016-2021.
Rosneft has retained Freshfields and Linklaters to advise on various corporate, commercial and antitrust aspects related to the joint ventures. The Freshfields team is being led by Moscow corporate partner Sergei Diyachenko and the Linklaters team is headed up by corporate, finance and securities partner Grigory Gadzhiev.
Morgan Lewis is acting as sole legal counsel to Statoil, with a team led by Moscow-based business and finance partner Jonathan Hines in Moscow and business and finance partner Bruce Johnston in London. The rest of the team spanned the firm’s Moscow, London, Brussels and Houston offices.
Background to this deal:
Freshfields and Linklaters have been two of the key law firms retained to advise the main players embroiled in the travails of the Russian oil and gas market in recent years. The duo were the only magic circle firms to be reappointed to BP’s coveted UK legal panel last year (26 May 2011).
Linklaters then acted for BP when it signed a £10bn share swap deal with Rosneft in early 2011, while Rosneft retained Freshfields for the deal (24 January 2011).
However, the deal folded as the agreement sparked a heated dispute between BP and the Russian investors in its existing joint venture TNK-BP. BP turned to Linklaters once again for arbitration counsel as it battled it out in the courts with Alfa-Access-Renova (AAR), the Russian oligarch consortium behind TNK-BP. Skadden Arps Slate Meagher & Flom acted for AAR (12 May 2011).
Freshfields was drafted in once again in to advise Rosneft as it cast its net stateside and opted to sign a deal with ExxonMobil. Skadden Arps Slate Meagher & Flom advised the US multinational (31 August 2011).
Meanwhile last month it was Linklaters’ turn to act for Rosneft once again as it signed a $2bn (£1.3bn) cooperation agreement with Italy’s Eni to jointly develop Russian offshore energy deposits in the Barents Sea and the Black Sea. The firm’s Moscow managing partner Matthew Keats led the deal alongside Grigory Gadzhiev. Herbert Smith acted as legal advisers for Eni, with corporate partner Danila Logofet and finance partner Ed Baring leading the team there.
Morgan Lewis acquired Statoil as a client when Dewey & LeBoeuf’s entire Moscow base jumped ship to the firm earlier this year (4 May 2012). Business and finance partner Hines has acted as a longstanding adviser to Statoil, having advised the Norwegian company since 2004 on a number of projects in the region including Shtokman, the proposed Barents Sea mega-gas field to LNG project also involving Gazprom and Total, which recently has been suspended.
Morgan Lewis also acted opposite Rosneft last month as it advised Itera as the two companies completed a strategic joint venture to jointly develop gas fields in the Russian Arctic. Allen & Overy was retained to advise Rosneft on this occasion (23 August 2012).
Meanwhile, ONGC Videsh, the overseas investment arm of India’s state-owned Oil & Natural Gas Corporation, has also expressed an interest in acquiring a stake in one of Rosneft’s oil and gas blocks. If this goes ahead, this could see the Indian company take a stake in any of Rosneft’s recent joint venture agreements, which would mean that many or even all of the agreements would need to be reviewed and amended.