Rosneft and Statoil are moving forward in the development of the Domanik shale formation by signing a deal to set up a joint venture, reads the official statement.

      The heads of the two oil giants met to ink the Shareholders and Operating Agreement to explore the feasibility of the project.

      The document was signed by Igor Sechin, Rosneft CEO, and Helge Lund, Statoil CEO.

      According to the press release, it’s a second major document on shale oil cooperation signed by the two companies this year.

      ‘Participation of a reliable partner like Statoil and the use of state-of-the-art technologies will help us accelerate the launch of hard-to-recover reserves development which in the future will be positively reflected in Rosneft financial statements and will increase its shareholder value,’ said Mr Sechin.

      ‘Today’s agreement demonstrates the two parties’ commitment to jointly move forward in an attempt to unlock the hydrocarbon potential of Domanik shale formation. If successful we believe this could be a world class shale oil asset’, said Statoil CEO Helge Lund.

      The newly founded joint venture is expected to run a three-year pilot programme to assess the potential for commercial production. The JV will be established with equity interests of 51% for Rosneft and 49% for Statoil.

      In accordance with the agreement, Statoil will provide carry-based funding to perform the pilot survey programme in 12 license blocks. The pilot programme will include data acquisition, drilling and hydraulic fracturing of pilot wells. Upon completion of the pilot programme, Rosneft and Statoil will jointly select license blocks in the Samara region for commercial development.

      Rosneft has become the world's leading publicly traded oil producer after it took over BP's Russian venture TNK-BP for $55 billion in March 2013. Rosneft has a vast and high-quality reserve base, with total proved hydrocarbon reserves of 22.8 bln barrels of oil equivalent – among the best indicators for a global publicly traded oil and gas company. The company’s proved reserve-to-production ratio is 25 years.