Mobil signs PSA with Turkmenistan

July 10, 1998 Mobil has signed a production sharing agreement (PSA) with the Government of Turkmenistan to pursue exploration and development opportunities in the Garashsyzlyk ("Independence") concession -- an approximately 4,500 sq km area within what was previously called Zone 1 -- onshore Western Turkmenistan.
In signing the agreement, Mobil became the first US oil company to sign a PSA with Turkmenistan. The signing of the PSA follows the formation of a strategic alliance announced earlier this year between Mobil, Monument Oil & Gas, Turkmenistan and its producing association Turkmenneft.
Mobil E&P Turkmenistan will operate the venture with a 52.4 % interest. Partners are Monument Oil & Gas (27.6 %) and Turkmenneft (20 %).

The Independence block is an onshore continuation of the prolific Apsheron trend in the South Caspian Sea. It lies immediately adjacent to the Nebitdag concession, which is now producing oil for export and in which Mobil has a 40 % interest.
The new production sharing agreement covers the exploitation of under-developed deeper resources discovered below the Kotor Tepe, Barsa Gelmes and other fields, as well as exploration and appraisal activities outside the boundaries of existing producing fields in the block.
"This agreement marks a significant step for Mobil," said M.W. Scoggins, president, International Exploration and Producing, Mobil Corp., who was at the signing ceremony. "In a year in which we have seen our first production and first exports from Turkmenistan, it marks another step towards our goal of building a major hydrocarbon reserve position in Western Turkmenistan. On a broader scale, it further enhances our strong and integrated position in the Caspian region, where we have joint ventures in Russia, Kazakhstan, Azerbaijan and Turkmenistan."
"Turkmenistan is a country with great ambition and substantial potential and we are proud to be making an important contribution to the efforts of the Government and people of Turkmenistan to realise their goals."

Mobil was the first major international oil company to invest in Turkmenistan, joining Monument Oil & Gas in its production sharing agreement to develop and explore opportunities in the 2000 sq km Nebitdag concession.
Gross production from the Burun field in the Nebitdag concession is currently 15,000 bpd and is expected to rise to 26,000 bpd by year end.
Elsewhere in the Caspian region, Mobil projects include:
- In Kazakhstan, Mobil holds a 25 % interest in the giant Tengiz oil field with reserves of more than 6 bn barrels. Production from Tengiz is currently 180,000 bpd and is expected to reach 250,000 bpd by 2000.
- Mobil holds a 7.5 % interest in the Caspian Pipeline Consortium which is planning to construct a 900-mile pipeline from the Tengiz field to the port of Novorossiysk on the Black Sea. The pipeline is scheduled for completion in 2000.
- Mobil holds a 14.3 % interest in the Offshore Kazakhstan International Operating Company (OKIOC) which will commence exploration drilling onthe Kashagan prospect in the North Caspian Sea later this year. In addition, the first exploration wells on the onshore Tulpar Munai block in Western Kazakhstan, in which Mobil holds a 25 % interest, are planned for 1998.
- In Azerbaijan, Mobil holds a 50 % interest in the offshore Oguz block where exploration drilling is expected to be completed over the next 3 years.