ABB scores billion-franc Russian deal
The Swiss-Swedish engineering group, ABB, has signed a Russian oil and gas contract worth more than a billion francs.
ABB announced the deal with Exxon Neftegas to develop onshore oil and gas processing and support facilities in Russia’s Far East on Monday. The contract is worth $987 million (SFr1.43 billion).
The Sakhalin 1 project calls for the biggest direct foreign investment ever made in Russia. It covers three offshore oil and gas fields off Sakhalin Island, with estimated reserves of 2.3 billion barrels of oil and 17 trillion cubic feet of gas.
According to the company, the first oil production from the project is scheduled in 2005. The contract includes engineering and design, procurement of equipment and materials, as well as the construction of the production and support facilities.
“The Sakhalin 1order is in line with ABB’s focus on projects with both higher engineering content and a higher proportion of reimbursable rather than fixed price contracts,” said the company.
Exxon Neftegas is the operator for the multinational Sakhalin 1 consortium with a 30 percent stake. Other consortium members include the Japanese company Sakhalin Oil and Gas Development Company, ONGC Videsh, Sakhalinmorneftegas-Shelf and RN-Astra.
ABB’s announcement comes just two days before its half-yearly results are released. Analysts expect a 35 per cent fall in net profit to $174 million.
swissinfo with agencies
In compliance with the JTI standards
More: SWI swissinfo.ch certified by the Journalism Trust Initiative
You can find an overview of ongoing debates with our journalists here . Please join us!
If you want to start a conversation about a topic raised in this article or want to report factual errors, email us at english@swissinfo.ch.