Dragon Oil targets Cheleken capex at $1.5 bln in 2014-2016
MOSCOW. Aug 5 (Interfax) - Dragon Oil, which produces oil in Turkmenistan's section of the Caspian Sea, targets capital expenditure for infrastructure and drilling in the Cheleken contract area at $1.5 billion in 2014-2016, the company said in its report on interim results for 2014.
It plans to invest $500 million this year, of which $279 was invested in the first half. In addition, Dragon Oil plans capex of $200 million-$300 million over three years for the gas treatment plant.
The company projects Cheleken production to rise 5%-10% in 2014 to 87,000-90,000 barrels per day by the end of the year. Production is slated to rise to 100,000 bpd in 2015.
Dragon Oil plans to drill 14-16 wells at the block in 2014, including sidetracks. Seven wells were completed in the first half. The company has four drilling rigs in operation.
Net profit rose 20% to $289 million in the first half on revenue of $547 million, 11% more. The increase was primarily due to a higher sale price for crude and a 4% increase in volumes to 5.9 million barrels.
Dragon Oil also reported that the well drilled by its joint venture in the Philippines, Nido Petroleum, failed to discover commercial hydrocarbons. Dragon Oil is currently assessing its furure interest in the project.
Dragon Oil operates the contract territory of Cheleken in Turkmenistan's sector of the Caspian Sea under a production-sharing agreement signed in 1999. Cheleken includes two fields, Dzheitune and Dzhygalybeg. 2P reserves totaled 675 million barrels at the end of 2013.
Dragon Oil is also exploring for hydrocarbons in Iraq under a joint venture with Kuwait Energy, and in Tunisia, Afghanistan and Egypt.
