Rosneft and The World Bank have signed an Emission Reduction Purchase Agreement for the reduction of greenhouse gas emissions resulting from the utilization of the associated gas from the Rosneft Komsomolskoye oil field in Yamal-Nenez autonomous region. The oil field is being developed by Rosneft's subsidiary - RN-Purneftegaz. The World Bank acts as Trustee of and the Danish, Italian and Spanish Carbon Funds as well as the Carbon Fund for European. During the period of 2010-2012 Rosneft will generate and sell 5.3 million Emission Reduction Units (ERUs) to the above-mentioned Funds (one ERU equals one ton of carbon dioxide), which can be used for compliance with the Kyoto Protocol or the EU Emissions Trading Scheme.
The World Bank, owned by 185 member-states, will formalize the transactions with ERUs and monitor and control compliance with procedures governing project implementation.
The infrastructure building program required for the associated gas processing and transmission on the Komsomolskoye field aims to increase the level of the gas utilization within Russian and international procedures as the part of the Kyoto protocol implementation. By this project the gas from the Komsomolskoye field will be transmitted to the Gazprom unified gas supply system.
In accordance with the Russian government decree # 322, experts from Rosneft prepared the required set of documents to the project application review commission by the Ministry of the Economic development within the article 6 of Kyoto protocol.
Rosneft is prepared to invest about 4 billion rubles at this stage of its gas utilization project. Additional ERU purchase agreements could help increase the economic efficiency of production in the framework of the project.
The Kyoto protocol is an international legal document adopted in Kyoto (Japan) in December 1997 as the addendum to the United Nations Framework Convention on Climate Change. It was then ratified by more over than 160 states with the overall responsibility for the 60% of the global emission into the atmosphere. On February 16, 2005 the Federal Law on ratification of the Kyoto protocol was approved. Russia has committed to maintain its annual emissions at 1990 levels in the course of 2008-2012.
The protocol provides for the so called flexible mechanisms. It also includes trading in quotas. Countries and companies located in such countries can purchase and trade greenhouse gas emission quotas on the national, regional and international markets.
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