Total, Europe’s third-biggest oil company, agreed to buy 12% of OAO Novatek and join the gas producer’s Arctic LNG project to expand in Russia.

Total is paying about US$4-billion for the stake, Chief Executive Officer Christophe de Margerie said today at Prime Minister Vladimir Putin’s residence near Moscow. The French explorer plans to raise its holding to 19.4% within three years, according to a statement distributed to reporters.

Global oil producers are looking at Russia to boost reserves. Russia, the world’s biggest energy producer, needs foreign expertise to develop challenging projects in harsh, remote areas to maintain output. Russia wants to boost LNG output to expand in growing Asian markets and compete in Europe.

“It is a good deal that has great potential,” Putin said.

Novatek shares have gained 30% in the past three months, raising the value of stake to US$4.7-billion based on today’s price. That is more than the company’s market value in 2004 when Total made a failed bid to buy 25%.

Total will appoint a director to Novatek’s board, the company said in a statement. It will gain access to equity production of 120,000 barrels of oil equivalent a day and about 1-billion barrels of proved and probable reserves, it said.

Total is buying the stock from Novatek’s billionaire CEO Leonid Mikhelson and Gennady Timchenko, co-founder of energy trader Gunvor International BV. The two men don’t plan to significantly cut their stakes, Mikhelson said. The sale may close in April, Total said.

The tumult in oil and gas producing countries in northern Africa shows the need to be in Russia, de Margerie said in a meeting with President Dmitry Medvedev today, according to a transcript in Russian. Russia has safer conditions for investment, he said.

Putin in January praised a planned strategic alliance between BP Plc and state-run OAO Rosneft, Russia’s largest oil producer, to swap shares and explore Arctic offshore resources. TNK-BP, BP’s oil venture with a group of billionaires, is seeking to replace the U.K. company in that deal.

The Russian prime minister, who approves major energy deals in the country, pledged “good administrative support” for Total at a meeting with de Margerie in June.

Total will gain 20% of the Novatek-led Yamal LNG project, according to today’s agreements. The companies aim to complete the deal in the first half, Total said.