Hurricane inks Kazakhstan oil compromises with LUKoil
Hurricane Hydrocarbons confirmed the signing on December 27, 1999, of comprehensive agreements with a subsidiary of
LUKoil Oil Company of Moscow regarding the management and operation of the Kumkol-LUKoil joint venture in Kazakhstan.
Hurricane and LUKoil are each 50 % shareholders of CJSC Kumkol-LUKoil which owns and operates the Kumkol North oil
field.
The agreements set a payment schedule for lease payments of approximately $ 25.6 mm due by Kumkol-LUKoil for assets
leased from Hurricane's subsidiary, OJSC Hurricane Kumkol Munai ("HKM"). Approximately $ 10 mm of this amount was
received by HKM during December 1999 and the balance is anticipated to be received before August 31, 2000.
Under the terms of the agreements, HKM will continue to market the production from the joint venture and to provide
services to the joint venture on a fee for service basis. Cash flow generated within the joint venture in excess of
requirements will be distributed to HKM and LUKoil.
Other provisions of the agreements deal with the appointment of officers and directors of the joint venture company,
the mechanism for the distribution of surplus funds to the shareholders and for a change of name of the joint venture
company to "CJSC Turgai Petroleum".
The signing of these agreements establishes a solid foundation for the further development of Turgai Petroleum's reserve base in the Kumkol North field which is currently producing approximately 28,000 bpd.
