The procedures for Total’s membership in Shtokman have been reported by two sources close to Gazprom negotiators. “Conditions offered to Total materially differ from those offered so far to other project participants. The matter at stake is the economic parameters, not the political ones,” a Gazprom manager explained. “The extent of the market risk and responsibility for attaining certain budget parameters and for the project dates have been shared pro rata by Gazprom and Total,” another source specified. “The investors will risk their money pro rata the project interest should the launching deadline be violated, any technological problems emerge and in respect of any other risks of the special-purpose company [the project operator].”

Shtokman field of gas condensate has 3.66 trillion cu meters of gas in proven reserves of C1, C2 categories. The first stage of the project provides for the launch of production in 2013 and the annual output of $23.5 billion; the budget is estimated at $14 billion to $15 billion. Shtokman license holder, Sevmorneftegaz, made a contract with the project operator to set up the infrastructure and for the gas production. Gazprom will retain 51%, Total will have 25%. In return, Total will be able to add to the statement of assets and liabilities 25% of 1.22 trillion cu meters to be developed during the first state.

Total will pay certain amount to Gazprom above the required investments for the chance to show these gas reserves in the statement, said a source familiar with the contract conditions. The amount could be about $800 million, the analysts calculated based on available figures. The agreement of Total and Gazprom is valid only for the first stage of the project, i.e. for 20 years to 25 years. (kommersant.com)