ExxonMobil and Rosneft Arctic Collaboration Essay

ExxonMobil and Rosneft Arctic Collaboration - Essay Example The entire project is at risk from a large number of factors that span the financial, compliance, strategic and operational domains. The project is set to create an open framework that allows information and expertise sharing along with data availability and accessibility. Another aim is to augment oil reserves and to ensure oil supply as per global demand. Similarly the project looks to develop world class expertise and to come to an agreement that is beneficial and protective throughout the life of the project. Another underlying aim for Exxon is to become a leading oil giant. A large challenge is to achieve cooperation across the table and to deal with a state controlled country. This may give rise to legal issues and the US Congress may be reluctant to support such an initiative. Environmental groups would also oppose efforts for exploration and the icy environment would be a large challenge to work with as well as problems in oil spills, waste disposal and oil transportation. Th e project would proceed as semi-sub drilling with daily costs of $700,000 producing some 160,000 barrels per day. A joint venture framework would be used as the political and economic climate of the US Russia relationship is precarious over the longer run. The largest risk anticipated by the project is price volatility in the international market given that the project stretches some two decades. The collaboration between Exxon Mobil and Rosneft Arctic Corporation is a very positive step in order to promote collaboration between the US and Russia. Moreover such collaboration can provide much required relief to the international energy markets as more oil is discovered and exploited. The Russian side has the territorial space and the jurisdiction while the American side has the capability to provide the technical expertise that is much required to carry out this project. The largest technical challenge will stem from the function of the TLP’s tendons under the