23 Sep 2009 17:00

NNK, PDVSA may sign agreement to set up Junin-6 JV next week

MOSCOW. Sept 23 (Interfax) - National Oil Consortium (NNK), a consortium of Russian oil companies, and Venezuelan PDVSA may sign the agreement on setting up a joint venture to develop the Junin-6 block in the Orinoco River Basin next week.

The document signing will take place in Venezuela, a source close to NNK told Interfax.

It was previously thought the document might be signed in Moscow during President Hugo Chavez's visit on September 9-10.

After the signing, the Russian companies must pay the first tranche of the bonus for development of fields in Venezuela, which will total approximately $1 billion.

It was reported earlier that PDVSA officials plan to meet with the companies bidding in tenders on the Carabobo-1, -2, -3 and -4 blocks in the Orinoco Belt. The tenders will be held at the end of 2009.

The companies that make up NNK have said they are interested in bidding for those blocks.

Russia registered NNK in October 2008 to develop oil and gas fields in Venezuela. The consortium includes Gazprom Neft , Lukoil , Rosneft , Surgutneftegas and TNK-BP . Each of the companies has a 20% interest.

The resource at Junin-6 totals as much as 53 billion barrels. Investment in the project, including construction of oil upgraders and other infrastructure, might total $30 billion, according to estimates by the Russian companies. Production at Junin-6 might reach 450,000 barrels per day.

Russian companies also operate in Venezuela outside of the consortium: Gazprom is developing the Ayacucho-3 block, Lukoil is developing Junin-3 and TNK-BP - Ayacucho-2. However, those projects might also be transferred to the joint venture.