Prime Minister Vladimir Putin on Thursday invited foreign investors to develop a huge untapped gas region in Siberia and indicated that the state could provide tax breaks for projects there.
Putin chaired a meeting with government officials and foreign investors in Salekhard, a city 1,950 kilometers (about 1,200 miles) northeast of Moscow just above the Arctic Circle, courting investors to work in the Yamal peninsula which is thought to contain at least 12 trillion cubic meters of natural gas.
In the long term, Yamal could yield 360 billion cubic meters a year, Energy Minister Sergei Shmatko said at the televised meeting.
Russia's state gas giant Gazprom, whose Soviet-era fields are getting depleted, sees Yamal as a priority.
Putin said the government will consider a tax grace period for investors before their investments break even.
The meeting was attended by executives from more than a dozen global energy companies including E.On, Royal Dutch Shell, and Eni.
In possible deals with the foreigners, Russia would be seeking to use their high technology, Putin said. He also pledged cooperation and help for any investor that would join the project.
"We want you to feel part of the team," Putin said. "We want you to see that Russia is working on this project in a frank and transparent manner."
Gazprom's chief executive Alexei Miller voiced hope that Yamal will become a new hub of liquefied natural gas production, an industry the company considers key for its development. Major projects like Yamal could help Russia control a quarter of the market, he said.
Regional Gov. Yuri Neyolov welcomed foreign investment by saying that "not a single investor has ever been cheated in Yamal." "You should take your money and rush to us — and we'll help you spend it," he said.
ExxonMobil and Royal Dutch Shell executives said at the meeting they would study options to cooperate with Gazprom on the project, but did not provide detail.
Meanwhile, Miller said after the meeting that France's GDF Suez could join Gazprom's Nord Stream pipeline project before the end of the year, and that Gazprom is likely to start negotiations soon with another French company, EDF, on its possible participation in the South Stream project, Russian news agencies reported.
Nord Stream would deliver Russian gas directly to Europe through a Baltic Sea pipeline, bypassing ex-Soviet neighbors Belarus and Ukraine. South Stream would pipe Russian gas across the Black Sea to the Balkans and other parts of Europe.
Putin's courting of investors comes after his meetings with Royal Dutch Shell and Total in June when he urged the companies to further expand in Russia.
Moscow has been stepping up pressure on foreign energy companies in recent years as part of its effort to consolidate control over Russia's largest hydrocarbon deposits. But now that the downturn has hit Russia's oil and gas exports, the Kremlin is looking at foreign investors to help with its huge untapped resources.
Industry analysts repeatedly warned that Russia's new hard-to-tap oil and gas fields will take a very long time to develop if Russia does it on its own. While trying to ensure control, Russia is seeking Western involvement and expertise, particularly on projects for liquefied natural gas.
