The American oilfield service company Schlumberger, for the sake of buying a stake in Eurasia Drilling Company, is ready to provide part of the technology to the Russian competitor. This is done in case Schlumberger will have to leave Russia because of US sanctions
For more than a year Russian authorities have been considering a repeated application by Schlumberger to buy a stake in the Russian Eurasia Drilling Company (EDC). The process is not easy. Last summer, Schlumberger asked to approve the purchase of 51% of EDC, but earlier this year, it lowered the bar to 50% minus 1 share and structured the deal so that Schlumberger's share in the company will be less than 25%, the rest will belong to its pension fund.
But that's not all the concessions the American company has gone to. Schlumberger pledged not only to sell a stake in the EDC, if the US increases sanctions against the Russian oil and gas sector, but to leave the imported technologies in the Russian company, Vedomosti told four people close to the different sides of the deal being prepared. They say that in the next two months the issue of approving the Schlumberger deal and EDC will again be submitted to the commission on foreign investment.
Buy a further 16.1% of EDC is also planned by the Russian Direct Investment Fund (RFPI) in conjunction with a fund from the United Arab Emirates Mubadala. But the partners agreed that Schlumberger will buy its own package, and then the company will acquire a stake in the RFPI and Mubadala, three people said, close to the various participants in the deal being prepared.
It's not difficult to transfer technology, I'm sure the partner of the law firm "Egorov, Puginsky, Afanasiev and Partners" Anna Numberova. The government commission can give consent to the transaction with certain conditions. They are fixed in an agreement between the Federal Antimonopoly Service (FAS) and Schlumberger, where the terms of execution of the agreement are prescribed. And then Schlumberger informs FAS about the progress of technology transfer, and the service checks, lists Numerova. Technologies can be transferred both in ownership and for temporary use. In the first case, you can register as a contribution to the authorized capital and partially pay a share in the company for this account, says Numeroeva.
What specific technologies can provide Schlumberger - interlocutors "Vedomosti" do not say. Two of them report that while "this is the subject of discussion."
Representatives of Schlumberger and EDC did not answer Vedomosti's questions. Their colleagues from RFPI and FAS declined to comment. "This is confidential information," notes a person close to the FAS. In addition, "arrangements have not yet been fixed on paper," he continues.
Schlumberger estimated its technologies, as well as intellectual property, software and other know-how at the end of June 2018, at $ 2.4 billion (26% of intangible assets and 3.4% of total assets of the company). This is more than the worth of the Schlumberger brand ($ 2.2 billion), and more than the company invested in subsidiaries ($ 1.5 billion). EDC does not publish reports since 2014. But even in the 2008-2014 reports, did not disclose in the amount of balance assets the value of its intellectual property.
There are no offshore drilling technologies in Russia, the geologist of a large oil and gas company says. According to him, there is a lack of knowledge for drilling complex wells with a branched pipe system, there is almost no software for analyzing wells during drilling. According to the interlocutor of Vedomosti, Schlumberger and Halliburton specialize in biomechanics, they know how to drill a well properly, cut off water and open up reserves so that production is maximized. Although it is unlikely that Schlumberger will leave in Russia the technology for drilling on the shelf, the expert says.
In addition, in July 2014, the United States limited exports to Russia of equipment for deep-sea drilling, production of hydrocarbons in the Arctic and shale oil.
"Schlumberger has better horizontal drilling technology than Russian companies, but no matter what the know-how - they give a gain in profits of about 2-3%," says Igor Melnikov, president of Soyuzneftegazservice.
Now investing in Russian companies in the oil and gas sector is risky enough, says the head of the "Fiscal Policy" section of the Economic Expert Group Alexander Suslin. The US is preparing a new package of sanctions, which may affect, among other things, the energy sector in Russia. Therefore, it is rather difficult to explain the logic of Schlumberger's actions. It is possible that now the company can delay the procedure to understand what exactly to expect from the new sanctions, she believes. Perhaps, with regard to the EDC, Schlumberger has agreements at the political level, Suslin does not exclude.