Sibneft Secures Development Licenses In Chukotka

Moscow, 24 April 2001; Sibneft affiliate Sibneft-Chukotka has secured licenses to three onshore blocks in the Chukotka autonomous district. The development of the new acreage will play an important role in helping Sibneft achieve its goal of expanding its upstream operations beyond its home base in Western Siberia.

The unexplored Lagunny Depression and the Telekayskoye and West Ozyornoye blocks are located in the Anadyr basin to the south of the district's capital. Sibneft plans to begin drilling its first exploration well in the Lagunny Depression in early summer, after recently completing the delivery of equipment to the drilling site on Molchalivy island. The acreage is believed to harbour possible reserves of some 275 million barrels (38 million tonnes).

The Telekayskoye block holds total recoverable reserves of some 20 million barrels (2.8 million tonnes) and 2 billion cubic metres of gas, while the West Ozyornoye block has recoverable reserves of some 5 billion cubic metres of gas. The acreage is being evaluated by specialists from Gazprom subsidiary Zapsibgazprom, which is considering an operating agreement for the field.

"The region around Chukotka is one of the world's last remaining unexplored provinces," Sibneft president Eugene Shvidler noted. "The development of new acreage beyond the confines of our home base in Noyabrsk is a cornerstone of our growth strategy. The risks of this venture are justified by the region's significant reserve potential."