Russia's top crude oil producer Rosneft will sell drilling rigs to Norway's North Atlantic Drilling (NADL) in return for shares in the firm, going ahead with an earlier agreed deal despite sanctions over Ukraine.

Rosneft and its head Igor Sechin, a long-standing ally of Russian President Vladimir Putin, have been sanctioned by the West over Moscow's role in the Ukraine crisis, limiting the firm's access to international financial markets.

Earlier this month, Norway decided to join the US and European Union in the punitive measures against Moscow.

Even though the sanctions do not stop Rosneft from signing the agreement, the Kremlin-controlled firm may face difficulties in funding the deal as its access to the capital markets is limited by the punitive measures.

But a source close to the deal said that the main component is the asset swap, rather than cash. A Rosneft spokesman declined to comment on the amount of cash the firm would need to fund the deal.

In a separate statement, NADL said that Rosneft will get an approximately 30 per cent stake in the company by the issue of new shares at the previously agreed price of $9.25 per share, with the balance between the value of the rigs and the new shares being paid to NADL in cash.-Reuters