Sovcomflot and Shell International Trading and Shipping Company Limited sign General Co-operation Agreement

On 27 June 2009 OAO Sovcomflot and Shell International Trading and Shipping Company Limited (STASCO) signed a General Co-operation Agreement, in Novo-Ogaryovo. The official signing ceremony followed negotiations between Russia’s Prime Minister Vladimir Putin and the top management of Royal Dutch Shell – including Chief Executive Jeroen van der Veer and his successor, from 1 July 2009, Peter Voser.

The Co-operation Agreement was signed by Sergey Frank, Sovcomflot’s President and CEO, and Jan Kopernicki, Vice President of STASCO. It covers Russia’s future projects for the seaborne transportation of liquefied natural gas (LNG), including shipments from the Arctic offshore fields. In particular the Agreement envisages the expansion of cooperation between the parties as the Sakhalin-2 project progresses; the organisation of joint transport and logistical support for the development of natural gas fields in the Yamal Peninsula; further improvement of the LNG transportation technologies used in harsh ice conditions, including floating LNG plant projects, and the construction of vessels with onboard regasification units to supply Russia’s remote areas with gas.

According to Sergey Frank: “The agreement allows Shell’s in-depth experience in the production and transportation of liquefied natural gas (LNG) to be combined with Sovcomflot’s knowledge and technical capabilities in delivering cargos by sea in the harsh ice conditions of the Arctic and Far-Eastern seas. This long-term international project is designed to implement highly effective and ecologically safe transport and logistical solutions for Russia’s future oil and gas projects, implemented in the offshore fields of the country’s Arctic and Far East”.

Speaking at the signing ceremony, Jan Kopernicki said: “Shell and Sovcomflot have for some time worked together on LNG seafarer training and through the development of the Sakhalin-2 project. The signing of these agreements builds on this and allows us to share our respective skills in LNG and Arctic shipping, to support future Russian LNG projects. Today, we have also signed crude tanker deals which further demonstrate the breadth of our co-operation”.

In addition to the General Cooperation Agreement there were long-term Contracts of Affreightment signed, whereby Aframax tankers owned by Sovcomflot (SCF) Group will transport Shell’s oil from the Northern European and Mediterranean Sea regions.