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Lukoil and Gazprom confirm oil and gas cluster joint venture

By Jenni Reid

10:52, 29 December 2021

Lukoil logo on its office in Serbia
Russian energy firms Lukoil and Gazprom Neft have confirmed a £525m joint venture – Photo: Alamy

Russian energy firms Lukoil (LKOH) and Gazprom Neft (SIBN) have signed a binding agreement over the creation of a joint venture to develop a large oil and gas cluster in western Siberia. 

Lukoil will take a 50% equity share in Gazprom subsidiary Meretoyakhaneftegaz for 52 billion rubles (£525m), including cession of the claim of 35 billion rubles' worth of Gazprom loans, and pay 8.9 billion rubles (£89.9m) for additional exploration of its blocks. 

The cluster is based in the Nadym-Pur-Tazovsky area of the Yamal-Nenets Autonomous District and has total reserves initially in place of over a billion tonnes of oil and about 500 bcm of gas.

The joint venture will also develop the Severo-Samburgskoye and Meretoyakhinskoye fields, and two Zapadno-Yubileiny license blocks.

Natural Gas

1.73 Price
-0.920% 1D Chg, %
Long position overnight fee -0.2517%
Short position overnight fee 0.2297%
Overnight fee time 21:00 (UTC)
Spread 0.0050

Gold

2,211.23 Price
+0.780% 1D Chg, %
Long position overnight fee -0.0188%
Short position overnight fee 0.0106%
Overnight fee time 21:00 (UTC)
Spread 0.30

Silver

24.62 Price
-0.030% 1D Chg, %
Long position overnight fee -0.0188%
Short position overnight fee 0.0106%
Overnight fee time 21:00 (UTC)
Spread 0.020

US Cocoa

9,528.30 Price
-0.530% 1D Chg, %
Long position overnight fee 0.0941%
Short position overnight fee -0.1160%
Overnight fee time 21:00 (UTC)
Spread 12.8

SIBN stock was down 0.63% to 537.3 rubles (£5.42) on the Moscow Stock Exchange at 11:00 GMT, while LKOH was down 0.21% to 6,464.5 rubles (£65.25).

Last week Russia’s deputy prime minister Alexander Novak said he expected oil output to increase 5% year-on-year and hit its pre-pandemic level by May.

Read more: Oil futures rise as Omicron worries ease

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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
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