Turkmen president supports Rosneft, Itera cooperation
MOSCOW. March 20 (Interfax) - Turkmen President Gurbanguly Berdimuhamedow has praised the prospects for cooperation between Rosneft and Itera and expressed confidence that it will facilitate further success in developing a hydrocarbon production project at 21 blocks in the Turkmen section of the Caspian Sea, Itera said in a press release following a meeting between its chief Igor Makarov and Berdimuhamedow.
The two Russian companies intend to create a joint venture that will include Itera's Turkmen assets, Rosneft President Eduard Khudainatov said.
Itera has secured a license in Turkmenistan to develop offshore block 21, necessary investments in which are estimated at $6 billion. Itera, which has no experience in offshore work, brought Russian state-owned Zarubezhneft into the fold, giving the company a 51% stake in the project. Later, Russian Deputy Prime Minister Igor Sechin, who chairs Rosneft's board of directors, expressed Rosneft's desire to participate in the project. However, the state-owned company's inclusion has been dragged out for political reasons.
According to preliminary appraisals, licensed block 21 has recoverable oil reserves totaling roughly 219 million tonnes, associated gas reserves of 92 billion cubic meters (bcm) and natural gas reserves of 100 bcm. At the end of February, Rosneft and Itera struck an agreement on strategic cooperation and the creation of a joint venture, which would include almost all of LLC Itera's assets (LLC Itera is 49% owned by OJSC Sibneftegaz, 49% owned by CJSC Purgaz and 67% owned by CJSC Uralsevergaz) and the gas fields of Rosneft's Kynsko-Chaselskoye group. The assets contributed by Itera possess roughly 350 bcm of proven gas reserves, and the Kynsko-Chaselskoye group's total reserves come to 40.2 million tonnes of oil and 284.2 bcm of gas, including 61 bcm of proven gas reserves. Itera has working assets with built infrastructure, while practically no production is being carried out at Rosneft's fields.
Khudainatov later said that the deal also includes Itera's international assets in the Baltics and in Turkmenistan. Itera owns 10% of Estonia's only gas purchaser and distributor, Eesti Gas, and 16% of Latvia's gas distribution company Latvijas gaze.
Rosneft's inclusion into a joint venture at the Kharampurskoye field is also being discussed. If it were to be included, the joint venture's total reserves would grow to 1.2 trillion cu m of gas and 60 million tonnes of liquid hydrocarbons.
Rosneft and Itera did not say whether they would use funds or stocks in the deal, although Khudainatov said that all of the assets involved have already been appraised.
