Rosneft, the world's largest listed oil company by output, is offering China a stake in a yet-to-be-built petrochemical plant (VNHK) in Russia's Far East in a move to widen cooperation, Chief Executive Igor Sechin said on Friday.

President Vladimir Putin has made cooperation with energy-hungry Asia a priority for Russian companies as their business with fragile European economies falters and as energy deposits in East Siberia are being developed.

In 2010, Rosneft and China's CNPC agreed to team up in building a refinery in Tianjin, China, with capacity of 13 million tonnes per year (260,000 barrels per day) but the two companies have yet to agree on terms to start construction.

"In exchange for our participation in the Tianjin refinery, we made a proposal to our Chinese partners. We are ready to consider our Chinese partners as investors in VNHK," Sechin told Russian news agencies in the Black Sea resort of Sochi.

On Friday, Russia opens the Winter Olympic Games in Sochi.

The VNHK petrochemical complex with expected capacity of 3.4 million tonnes per year at the first stage, is a bone of contention between Rosneft and oil pipeline monopoly Transneft, which wants Rosneft to finance the expansion of the East Siberia-Pacific Ocean pipeline that will feed the plant.

China has already outstripped Germany as the largest buyer of Russia's oil with pipeline shipments totalling 1.949 million tonnes in January, according to the Russian Energy Ministry.

Last year, the Russian state-controlled company signed a memorandum with CNPC to tap Russian oilfields jointly, in particular the Srednebotuobinsk deposit in East Siberia, which is feeding the ESPO pipeline.

GAS AMBITIONS

The $55 billion takeover of oil firm TNK-BP last year allowed Rosneft to boost its share of Russian oil output to over 40 percent, and the company now aims to become the country's second-largest gas producer after Gazprom by 2020.

Rosneft and ExxonMobil have agreed to build a plant to liquefy natural gas in the Far East with first train capacity of 5 million tonnes a year to feed fast-growing Asian markets from 2018.

Sechin said on Friday that Rosneft may consider building another LNG plant to monetise its offshore gas reserves but did not elaborate on possible partners, timing or location.

(reuters.com Feb 7, 2014)