NIS and RAG sign an agreement for joint exploration in the South of Hungary
NIS and Austrian Rohöl-Aufsuchungs Aktiengesellschaft, via its Hungarian subsidiary RAG Hungary Kft (RAG), have entered into agreements to jointly explore and develop hydrocarbons in the Kiskunhalas exploration license area west of the city of Szeged in southern Hungary. The license held by RAG Hungary comprises an area of 2255 km2.
The companies will invest jointly and share exploration risks and benefits from oil and gas production in the area. Under the terms of the agreement, NIS will have a 50 percent share in production volumes.
Following completion of a high quality 3D seismic study, the partners plan to drill the first wells in 2012. Exploration, appraisal and development costs in the license area will be shared in accordance with the parties participating interest in the project. RAG Hungary shall be the operator under the agreement.
By combining skills, knowledge and experience in neighbouring exploration areas in Hungary and Serbia, the partnership will be beneficial for both companies and stimulate investment in exploration activities in Hungary.
Kirill Kravchenko, CEO of NIS, commented:
“Partnership with RAG Hungary is another step in our strategy to actively develop NIS’s business abroad. We are focussed on exploration and production in the Pannonia basin area, and today there are several prospective projects in our portfolio in Hungary, Romania and Bosnia. Our strategic goal is not only to increase the volumes of hydrocarbon production but to grow our reserves and resource base. To achieve this we attract the best partners who are leaders in their industries. The partnership with RAG provides us with new experience, technologies and access to new regions ”.
NIS is one of the largest, vertically integrated oil and gas companies in Southeast Europe, dealing with exploration, production and refining of crude oil and natural gas, as well as with the sales of a broad range of petroleum products.The main shareholders of the Company are Russian energy company Gazprom neft and the Government of the Republic of Serbia. The Company owns two oil refineries in Pancevo and Novi Sad, as well as an extensive network of filling stations. The company operates in many European countries. In particular, NIS performs exploration and production projects in Serbia, Hungary, Romania, Bosnia and Hercegovina and Angola.
RAG carries out E&P activities in Austria, Germany, Hungary and Poland. In Hungary, RAG’s operations are carried out by its 100% subsidiary RAG Hungary.
In addition to exploration and production, RAG is one of Europe’s largest operators of underground gas storage. The gas storages of RAG and its storage partners not only serve the Austrian market but provide users in the larger Central European region with storage capacity of 5 BCM targeting up to 6 BCM by 2014.