Russia's state-owned Rosneft teamed up with U.S. company ExxonMobil on Tuesday to develop offshore Arctic oil fields, a deal that had eluded Britain's BP earlier this year.

Rosneft spokesman Rustam Kazharov told the Associated Press that the deal was signed in the presence of Prime Minister Vladimir Putin. Kazharov, who was overseeing the signing, could not immediately comment.

Russian news agencies quoted Putin as saying that Rosneft will also be able to develop oil fields in the Gulf of Mexico and Texas as part of the deal.

Because Rosneft does not have its own technology for deep sea drilling, it was looking for partners to develop the offshore projects in the Arctic and other regions of Russia.

Putin lauded Exxon for its extensive experience in drilling in the Arctic region in Canada.

The deal is a blow for BP, with which Rosneft struck a deal in January to jointly develop Russia's Arctic. That agreement fell through, however, after BP's Russian shareholders managed to block it.

Tuesday's signing ceremony was preceded by talks between Rosneft executives and ExxonMobil top brass, including President Neil Duffin.

Putin hailed the deal as "a truly strategic partnership", the RIA Novosti news agency reported. The prime minister estimated the total investment in the project at a massive $500 billion, a figure he described as "scary."