May 22, 2020 / 2:59 PM / a month ago

Spain's Repsol pulls out of planned Arctic JV in Russia

FILE PHOTO: The logo of Spanish energy giant Repsol SA is seen during the opening ceremony of its first gas station in Mexico City, Mexico March 12, 2018. REUTERS/Carlos Jasso

MOSCOW (Reuters) - Spain’s Repsol (REP.MC) has pulled out of a planned joint venture to develop two Arctic oil blocks with Russia’s Gazprom Neft (SIBN.MM) and Royal Dutch Shell (RDSa.L), a spokesman at Repsol said on Friday.

Gazprom Neft, the oil arm of Russian gas giant Gazprom (GAZP.MM), Repsol and Shell signed a memorandum of understanding last June on establishing a joint venture to develop the Leskinsky and Pukhutsyayakhsky blocks on the Gydan Peninsula in northern Siberia.

A deal on the venture, in which Gazprom Neft would hold a 50% stake and Repsol and Shell each own 25%, was expected to close this year.

“Its an option we had on a well we are choosing not to exercise,” Repsol’s spokesman said.

A source at Gazprom Neft said the Russian company will continue to cooperate with Shell on the assets.

“Repsol has informed Gazprom Neft that at the moment, it does not consider a possibility of participation in the project,” the source said.

Gazprom Neft declined to comment.

Reporting by Vladimir Soldatkin and Isla Binnie; Editing by Susan Fenton

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