Bashneft might found a consortium with PetroVietnam and Premier Oil

The Russian oil companies keep preparing for the geological exploration tender that will be held in mid April. They all will participate together with the foreign partners. Kommersant learnt that Bashneft completes the negotiations on the foundation of a consortium with PetroVietnam and the independent Premier Oil (Great Britain). Rosneft is discussing the possibility of partnership with ExxonMobil.
Bashneft is negotiating on the joint participation in the tender for 12 sites in Iraq with PetroVietnam and Premier Oil, sources of Kommersant familiar with the situation said. The parties are going to approve the parameters of the consortium within a month, one of the interlocutors said. It is already clear that Bashneft won’t be the operator. Bashneft has confirmed the fact of negotiations with different companies without any details. A source of Kommersant said that it is only about PetroVietnam and Premier Oil.
The tender for 12 license blocks in Iraq, 7 of which are gas and 5 – oil blocks, will be held on April 11-12th. It is the first tender where the licenses for geological exploration only are offered, up to the present moment the companies obtained the production projects. The data on the potential resources is not released.
Iraq started to hold the auctions on the deposits in the mid 2009. In the process of the 2nd stage 10 sites were sold. The rights for the development of the Zubeir deposit was obtained by the consortium headed by ENI, the Western Kurna-2 – consortium of Lukoil, that had been working there before the war, and Statoil. The recoverable reserves of the deposit are approximately estimated at 12.9 barrels (1.75 bln tons) of oil. Gazprom Neft has become another winner of the 2nd auction. Together with TPAO (Turkey), Kogas (Korea) and Petronas (Malaysia) it obtained the Badra oil deposit with the reserves of 2 bln barrels (272.8 mln tons). The consortium suggested producing 170 thousand barrels (23.2 thousand tons) at the deposit a day. In both projects the Russian companies participate in the status of the operator: after the return of the investment into the development they are paid the reward for the over-limit production, for Gazprom Neft it is $6/barrel.
A source close to Bashneft says that the company is interested first of all in the oil projects. He highly estimates the chances for the successful geological exploration but doesn’t mention which reserves the company relies on. There should be a fight among the Russian oil companies – besides Bashneft Rosneft, Lukoil, TNK-BP and Gazprom Neft are going to participate. A source close to Rosneft told Kommersant that it is negotiating on the foundation of the consortium for working in Iraq with its strategic partner ExxonMobil. Other oil companies don’t release their potential partners.
For Bashneft the geological exploration in Iraq might become the company's first foreign project. The company was interested in the tender for the sites of the shelf in Vietnam but finally decided not to participate in it. Gazprom and Zarubezhneft are already the Russian partners of PetroVietnam. In Iraq the Vietnamese company is developing the Amara gas deposit. At the beginning of the year it considered TNK-BP as a potential partner in the project. The British independent company Premier Oil is not working in Iraq as yet, but it participates in the geological exploration and production in 10 other countries, including Vietnam. In H1 2011 Premier Oil produced 46.6 thousand barrels of reference fuel, the net profit for that period - $88.5 mln.
Troika Dialog’s V. Nesterov says the possibility of exploring large oil and gas reserves at the Iraq blocks is very high. Bashneft in its turn has a good experience of drilling and geological exploratory works, the analyst says, but at this stage the company will hardly have enough resources to actively develop in Iraq, it had better focus on the existing projects.
Translated by Galiya Musabekova

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