04-03-04 The joint venture Turgai-Petroleum, owned equally by Russia's LUKoil Overseas and Canada's PetroKazakhstan, plans to increase oil production 20 % in 2004, LUKoil Overseas Service Kazakhstan Director Boris Zilbermints told.
The joint venture is developing the Kumkol field in southern Kazakhstan. Oil production at the field in 2003 amounted to 2.8 mm tons, which is 33 % more than in 2002.

The company plans to increase production to 3.4 mm tons this year, Zilbermints said. He said that LUKoil has been participating in the development of the Kumkol field since 1995, through Turgai Petroleum.
"This was the company's first project in Kazakhstan and it developed actively over the past years. Tens of new wells have been drilled and equipped and a lot of infrastructure has been built," the regional director said.

In 2003 Turgai Petroleum launched the 177 km Kumkol-Jusaly pipeline, making it possible to significantly reduce transportation costs from the field. The company started to supply oil through this pipeline into the Caspian Pipeline Consortium system in October last year.
Zilbermints said that in January-February this year about 100,000 tons of Kumkol oil was pumped into the CPC system per month. He said that at the moment testing of an associated gas processing plant is underway at the field. The full launch of the plant will "significantly increase the level of use of associated gas and supply the field's electricity requirements in full."

However, Zilbermints said that plans to increase production at the Kumkol field might be threatened. He said that LUKoil's partner in the project -- PetroKazakhstan "for unclear reasons, is delaying the signing of a preliminarily agreed budget, thereby preventing the company from fully functioning and meeting its obligations."
LUKoil Overseas Holding is the operator of LUKoil's international projects. PetroKazakhstan, with headquarters in Canada, produces oil at 11 fields in Kazakhstan.