Lukoil, ConocoPhillips Tap 13 Arctic Fields

US oil firm ConocoPhillips plans to invest $500 million this month to create an exploration venture with Russian oil major Lukoil, to ship Russian oil from Arctic to the United States.

The US company says it also will contribute $1 billion by 2008 to the venture, called Naryanmarneftegaz, raising its total investment in Russia to about $4.5 billion.

The partners plan to develop the Yuzhno-Khylchuyuskoye field, known as YK, which may hold 1.2 billion barrels of crude reserves, according standards set by the U.S. Society of Petroleum Engineers.

ConocoPhillips and Lukoil plan to tap 13 fields in the Timan- Pechora oil province and export crude via the Varandei port in the Barents Sea to Europe and beyond. Lukoil, which operates a gasoline retail network in the United States, says it plans to ship crude here to make fuel for its filling stations.