Turkmenistan discusses expanding partnership in fuel, energy sector with Dragon Oil
ASHGABAT. Aug 27 (Interfax) - Turkmen President Serdar Berdimuhamedov has met with Chairman of the Board of Directors of Dragon Oil Company (owned by the Dubai government) Saeed Al Tayer to discuss the prospects for expanding partnership in the oil and gas sector, the Neutral Turkmenistan newspaper reported.
The subject was discussed in light of Ashgabat's plans to develop the fuel and energy sector. Increased oil and gas production and processing, as well as exports of Turkmen energy resources and finished oil and gas chemical products are among the top priorities of the industry, the newspaper reported.
Berdimuhamedov said that there are good prospects for enhancing cooperation and the Turkmen side is willing to consider specific proposals from the company. The Turkmen leader was confident that meetings expected to take place during the current visit of the company's top management will contribute to the further development of bilateral relations.
As previously reported, the prospects for advancing bilateral partnership were discussed at a meeting between the Turkmen leader and UAE Minister of Economy Abdullah bin Touq Al Marri in late June.
Dragon Oil Company and Turkmennebit signed a memorandum of understanding in January, according to which Dragon Oil will add three new oil fields in Block 19 in the Turkmen sector of the Caspian Sea to its assets in Turkmenistan. The memorandum provides for increased investment by Dragon Oil in Block 19.
Al Tayer, chairman of the board of directors of Dragon Oil, said at the time that seismic surveying costing $35 million at Block 19 had confirmed its prospects. The block includes three new fields close to the Cheleken field.
Al Tayer said the next stage after signing the memorandum would be to drill two or three wells, and the third stage would involve production.
A production sharing agreement between Turkmenistan's government and Dragon Oil (Turkmenistan) Ltd gave Dragon Oil a 25-year license to explore and produce oil and gas at Cheleken in 2000. It has exclusive rights to negotiate a license extension of at least 10 years.
The Cheleken contract area includes the Dzheitune and Dzhygalybeg fields with 2P reserves of 675 million barrels.
Dragon Oil (Turkmenistan) Ltd increased average daily oil production at the offshore block to 10,000 tonnes or 35,000 barrels by the middle of 2017.
Turkmennebit and Dragon Oil (Turkmenistan) Ltd signed a contract in July 2022 to extend the PSA until May 1, 2035. The company's main goal is to increase oil production from the Cheleken contract area. Dragon Oil had invested $8.1 billion in drilling and equipping the field, producing a cumulative 437 million barrels of oil by the middle of 2022.
Dragon Oil's investments during the contract extension period will amount to another $7-8 billion. It is also expected that an additional 350 million barrels of crude oil will be produced at a daily rate of 60,000-70,000 barrels.
