Arco Plans Oil Deals With 2 Regional Soviet Councils

Atlantic Richfield Co., undeterred by growing political tension in the Soviet Union, said Friday that it has agreed to negotiate a joint oil exploration venture with two local Soviet governments.

The Los Angeles oil company said he agreement, signed last week, was the result of year-long discussions with the regional councils of Magadan and of the Chukotka Autonomous Area, both in the northeastern corner of the Soviet Union, across the Bering Sea from Alaska.

Any final agreement between Arco and the regional councils would also need approval from the Russian Federation and Soviet central government in Moscow.

The Arco announcement came as the sudden resignation of Soviet Foreign Minister Eduard A. Shevardnadze increased political uncertainty in the Soviet Union. Shevardnadze’s departure raised concerns about the possible emergence of a dictatorship, or some other political shift.

Though Arco declined to comment, oil industry analysts expect some U.S. energy companies to delay plans with the Soviets in light of the new uncertainties.

“I’m sure it delays everything,” said John Lichtblau, president of the Petroleum Industry Research Foundation. “One of the problems they have with making deals over there is that they didn’t know how reliable their partner was, who their partner was.”

The Soviet Union is the world’s largest oil producer, but its industry has fallen on hard times after peaking at 12.5 million barrels of crude oil production daily in 1988.

Lichtblau said Soviet production has now dropped to 11.3 million barrels a day. It is expected to drop even lower over the next several years unless the Soviets receive technological assistance from the West.

It is unclear how much new oil could be found in the Soviet Union, although some experts say higher production could easily equal that of a moderate-sized member of the Organization of Petroleum Exporting Countries.

Apparently, none of the major oil companies has gone beyond signing agreements that commit them to negotiate the possibility of a joint venture, similar to the pact announced by Arco.

Experts say Chevron might be the closest to getting a final deal with the Soviets. It is eyeing the large Tengiz oil field in the northeast Caspian Sea region, which the Soviets have estimated could contain 25 billion barrels of oil.