3 Jun 2010 10:13

Kovykta license holder RUSIA Petroleum files for bankruptcy

MOSCOW. June 3 (Interfax) - The General Director of OJSC RUSIA Petroleum , which holds the license to the giant Kovykta gas condensate field in Russia's Irkutsk region, has filed a bankruptcy petition with the region's arbitration court, TNK-BP , the company's major shareholder, said in a press release.

These actions followed the submittal by TNK-BP, on May 14, 2010, of an early repayment notice for a part of the loans issued to RUSIA Petroleum to finance development of the Kovykta gas condensate field.

The current financial situation precludes RUSIA Petroleum from timely repayment of its loans to TNK-BP Group, the press release said. In accordance with current legislation the General Director was obligated to file a bankruptcy petition with the court, it said.

TNK-BP announced its original decision to withdraw from the Kovykta project back in 2007. As the major shareholder and creditor of RUSIA Petroleum, TNK-BP is determined to recover its investments and minimize its financial losses. For this purpose, the company is determined to resort to the procedures prescribed by the current legislation, the company said.

RUSIA Petroleum was established in April 1992 to develop major hydrocarbon fields in the Irkutsk region. RUSIA Petroleum is the operator of the Kovykta gas condensate field. Since the beginning of its operations RUSIA Petroleum has conducted additional exploration at Kovykta, which generated reserve growth from 346 billion to more than 2 trillion cubic meters of gas.

In 2000-2007, the company carried out an exploration drilling program, built surface infrastructure, infield pipelines, prepared and approved project documentation. The pilot development of the field started in 2001. In 2009, production reached 41.7 million cubic meters of gas and 2,100 tonnes of condensate.

At present, 62.9% of RUSIA Petroleum shares are owned by TNK-BP structures, 24.99% by OJSC OGK-3 , and 10.78% by the Irkutsk regional administration.