Rosneft and BP's joint center on Arctic Technologies will have headquarters in St. Petersburg, Russia, RIA Novosti reported.
"The exploration of the (arctic) shelf will be definitely conducted in line with all norms of the environment protection," said Russia's Deputy Prime Minister Igor Sechin.
Russian officials estimated the recoverable gas and oil resources on the continental shelf at 100 billion tons.
As part of the deal, Rosneft will take 5 percent of BP's shares in exchange for about 9.5 percent of Rosneft's shares. It is BP's first deal since the Deepwater Horizon spill last year in the Gulf of Mexico, the BBC said.
"This unique agreement underlines our long-term, strategic and deepening links with the world's largest hydrocarbon-producing nation," said BP Chief Executive Officer Bob Dudley.