Gazprom Neft as an operator holding 30% in the consortium has won a license to develop an Iraqi Badra oil field with reserves of 2 bln. bbl of oil. The rest parties of the consortium are represented by Korea’s Kogas (22.5%), Malaysia’s Petronas (15%) and Turkish TPAO (7.5%). The Iraqi government holds a 25% stake in the consortium.
Gazprom Neft will be recovered for oil field development costs and remunerated at the rate of USD 5.5 per a produced barrel of oil (or in the form of adequate volume of oil).
The project implementation is scheduled for over 20 years and is to be launched in 2010. It is expected that the extent of oil production will make about 170 thousand bpd (8.5 mln tons per year).
Gazprom Neft Deputy General Director for Exploration and Production Boris Zilbermintz stated:
“We are well pleased both to win the tender and with the terms provided by the Iraqi party. Despite the fact that we have obtained a service contract, we expect, subject to certain reservations, to be able to consolidate Badra’s production into our financial reporting. Besides, in addition to coverage of the Company’s production costs from the part of the Iraqi government, Gazprom Neft will get a fair premium. This accomplishment represents a significant stage of our strategy in view of strengthening of the Company’s positions in the foreign markets”.