LukOil(OAO) LKOB Start of Production Drilling at West Qurna-2

  LukOil(OAO) (LKOB) - Start of Production Drilling at West Qurna-2

RNS Number : 0233C
LukOil (OAO)
25 April 2012
 



      LUKOIL STARTS ACTIVE DEVELOPMENT AT THE WEST QURNA-2 FIELD IN IRAQ

 

LUKOIL started  production  drilling  and construction  of  a  key  production 
facility, namely a Central Processing Facility,  at the West Qurna-2 field  in 
Iraq today.

 

Abdel Karim al-Luaibi, the Iraqi Oil Minister, and also the heads of the Basra
province,  Iraq's  South  Oil  Company,  LUKOIL  Overseas  and  of  the  major 
contractor companies Baker Hughes and Samsung Engineering all participated  in 
the festive ceremony dedicated to the occasion.

 

As part of this  drilling project, 23 directional  wells will be  constructed. 
Drilling operations  will occur  simultaneously at  5 well  pads by  means  of 
state-of-the-art diesel electric units  with a bearing  capacity of 450  tons, 
which allows workers to drill wells as deep as 5,000 meters without  equipment 
remounting. The units are specially  modified to be promptly relocated  within 
the well  pads  under  the  cluster slider  rig  scheme.  Later  the  drilling 
operations will be conducted at the other 4 well pads with similar units.

 

The Central Processing Facility will be constructed along with the  facilities 
for well pads infrastructure development and  oil gathering lines, as well  as 
the water  and  power  supply  systems,  shift camp  and  a  number  of  other 
infrastructure and support facilities.

 

'We have opened the  active field development stage  today. Upon reaching  the 
production volume of 150,000 barrels per day LUKOIL will receive the right  to 
reimburse expenses and  receive remuneration. After  the initial expenses  are 
reimbursed, the  project will  turn into  a self-financing  entity. The  total 
investments in the full-scale project  implementation will come to around  USD 
25 billion', Vagit Alekperov, OAO LUKOIL President, said.

 

The West Qurna-2 field, discovered in 1973 with the help of Soviet geologists,
is the world's second largest undeveloped field with recoverable oil  reserves 
of around  14 billion  barrels. The  field,  covering an  area of  340  square 
kilometers, is located  in the  southern part of  Iraq, 65  kilometers to  the 
north-west of Basra, a major seaport. The Development and Production Agreement
for the West Qurna-2 field was signed on January 31, 2010 for a 20-year period
with the  possibility  of  5-year  extension. The  project  parties  have  the 
following shares: LUKOIL, 56.25%, Iraq's  state-owned North Oil Company,  25%, 
and Statoil ASA, 18.75%.

 

                     This information is provided by RNS
           The company news service from the London Stock Exchange
 
END
 
 
STRKELBLLZFXBBB -0- Apr/25/2012 09:34 GMT