Turkmenistan, Mobil and Monument to develop Zone 1 in Western Turkmenistan

Apr 23, 1998 02:00 AM

Mobil Exploration and Producing Turkmenistan and the U.K.-based Monument Oil and Gas, have signed an agreement forming a strategic alliance with the Republic of Turkmenistan and Turkmenneft, the state oil company of Turkmenistan, to pursue exploration and development opportunities on the Zone 1 (now named Garashsyzlyk or " Independence") concession located onshore Western Turkmenistan.
The signing took place at Blair House during a state visit of His Excellency Sapamurat Niyazov, President of the Republic of Turkmenistan. It marks the culmination of more than a year of negotiations and the completion of a joint technical study conducted on the block under a Memorandum of Understanding signed by the parties early in 1997.
The Independence block is an onshore continuation of the prolific Apsheron trend in the South Caspian Sea and is located adjacent to the Nebit Dag concession which contains the producing Burun field.
The agreement defines the geographic areas of future co-operation, establishes the commercial terms of reference and sets the timetable for final commercial agreements including the execution of a production sharing agreement (PSA) covering the exploitation of underdeveloped deeper resources discovered below the Kotor Tepe, Barsa Gelmes and other fields and all exploration and appraisal activities below and outside the boundaries of the existing producing fields. It will be operated by Mobil with a 52.4 % interest; Monument will hold a 27.6 % interest, and Turkmenneft, a 20 % interest.
The agreement anticipates the completion of the terms of the PSA by mid-1998. In addition, it includes a provision where the government of Turkmenistan, Mobil and Monument will further advance their strategic alliance by pursuing additional exploration, production and transportation opportunities in Turkmenistan.

In 1997, Mobil became the first major international oil and gas company to invest in Turkmenistan, joining Monument in a PSA with the Turkmenistan government to develop and explore for hydrocarbons in the 2,000 sq km, onshore Nebit Dag concession in Western Turkmenistan.
Gross production from the Burun field is currently at 10,000 bpd and is expected to increase to 20,000 bpd by year-end. Recently Mobil shipped its first cargo of crude oil from the port of Aladja, Turkmenistan across the Caspian Sea to Baku, Azerbaijan. .
Mobil Exploration and Producing Turkmenistan holds a 40 % interest in the Nebit Dag concession; Monument Oil and Gas, the operator, holds a 35 % interest, and Burren/VSTT holds an 25 % indirect interest.

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