Russian oil giant Rosneft promised Tuesday to boost the nation's economy with a $157 billion project to reach five billion tonnes of oil as Moscow expands production in the Arctic.

Meeting with President Vladimir Putin, Rosneft chief executive Igor Sechin said that Vostok Oil, the company's project on northern Siberia's Taimyr peninsula, would see almost eight thousand kilometres (five thousand miles) of pipelines built and create 100,000 jobs.

Sechin called Vostok Oil "the biggest (project) being undertaken in the global oil sector" and one that would impact world markets.

"All in all, completing this project will allow for an increase in the country's annual GDP (gross domestic product) of two percent a year," Sechin said.

The project was forecast to cost two trillion rubles "at the first stage", and more than 10 trillion rubles ($157 billion) in all.

Vostok Oil includes several major deposits with a total resource base of five billion tonnes of oil, Sechin said. Developing it would involve building two airports and 15 "industry towns."

The project includes Rosneft's Vankor and West Irkinskoye fields, along with the Payakhskoye field owned by the Neftegazholding company.

It is part of the government's drive to develop new deposits in the Russian Arctic. The oil is to be shipped from a new port on the Taimyr peninsula.

The strategic plan for Russia's mineral resources stretches to 2035 and does not foresee a decrease in global demand though it does predict that demand for natural gas will partially replace that for oil and coal.

"Mineral resources will remain a competitive advantage of Russia's economy, and will determine the place and role of the country in the world," it says.

Environmentalists urged the Russian government last year to stop granting licenses to exploit several Arctic deposits, including West Irkinskoye, which Greenpeace said overlaps with a nature reserve in the Yenisey river delta.

Rosneft nonetheless won the West Irkinskoye license in October 2019.

"The project is very large and of course has great potential," Putin told Sechin, "I wish you luck."

He pledged last month in his annual state of the nation address to boost Russian incomes, after Russian economic growth slowed to 1.3 percent in 2019 according to data released last week by the state statistics agency.

apo/ma/wai

ROSNEFT

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