Russia's Arctic Oil Project Aims for 30 Million Tonnes Annually Amid Sanctions
Russia has begun extracting oil from its Vostok Oil project in the Arctic region, despite US and European sanctions. President Vladimir Putin approved the loading of the first shipment via video conference, targeting 30 million tonnes of crude oil annually by the second half of 2027.
The project is located in the Taimyr region of northern Siberia and includes several oil fields, including Vankor and Payakha. Four Indian state-owned companies, ONGC Videsh, Indian Oil, Oil India, and Bharat Petro Resources, jointly hold a 49.9% stake in Vankorneft, a company linked to the project.
The region may hold around 7 billion tonnes of oil reserves. The extracted oil will be transported through a 790-km pipeline to the Bukhta Sever terminal on the Kara Sea, where it will be loaded onto tankers and shipped to other countries. This new route could provide an alternative to oil supplies from Gulf countries, as ships carrying Russian oil to India would not need to pass through the Strait of Hormuz.
Around ₹4.4 lakh crore has been invested in the project so far, with an airport being built to support air transport for the project. The Vostok crude contains 0.01%, 0.1% sulphur, which is lower than the prescribed levels required for petrol and diesel production, making it beneficial for refineries.