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Russia open to more oil projects: Aiyar

Russian Minister, Aiyar discuss prospects of joint exploration

SAKHALIN (RUSSIA): The Sakhalin-I field in far-east Russia is expected to produce about 12.5 million tonnes of oil and 10 billion cubic metres of gas annually at its peak production level. Of this, ONGC Videsh Ltd's (OVL's) share will be 20 per cent in proportion to its equity. The total production of Sakhalin-I in its 40-year life cycle is estimated at 307 million tonnes of oil and 485 billion cubic metres of gas.

The Sakhalin-I project includes the Chayvo, Odoptu and Arkutun-Dagi fields. Over its 40-year life, plans call for producing 2.3 billion barrels of oil and 17 trillion cubic feet of gas. The total investment in full development of the fields has been estimated at more than $12 billion.

Officials said ExxonMobil had found an extra 560 million barrels of oil in the Sakhalin.

The discovery of new reserves, representing around a quarter of the already confirmed reserves of 307 million tonnes (2.3 billion barrels), would be a boost for the project.

Meanwhile, Russia has indicated its willingness to take along OVL for exploration of oil and gas in future Sakhalin projects as well as enhancing energy cooperation in third countries.

"We discussed prospects of Indian firms' participation in exploration and production business in India, Russia and third countries," Industry and Energy Minister Victor Borisovich Khristenko said after a three-hour meeting with Union Petroleum Minister Mani Shankar Aiyar here on Saturday.

Mr. Khristenko said a lot of groundwork was already done. He discussed with Mr. Aiyar the prospects of further cooperation in the energy sector.

Mr. Aiyar said Russia was willing to consider [New Delhi's participation] provided India and Indian companies came up with the right terms. "There is a distinct possibility of our being involved in other projects. Indo-Russian prospects on the Sakhalin islands appear most favourable."

Sakhalin-I and II projects have already been decided and Russia is planning to invite bids for Sakhalin-III, IV, V and VI in the vast energy-rich region.

OVL plans

ONGC Videsh is eyeing oilfields in East Siberia, which is estimated to hold some 20 billion barrels of reserves.

It is also looking at participating in the Russian continental shelf, which may contain oil and gas in four million sqkm of its total area of 6.5 million sqkm (the largest in the world).

The talks between the Ministers is believed to have covered OVL participation in the 3.2-trillion cubic metre super giant gas field Shtokman and the Prirazlomneye oilfield, which holds recoverable oil reserves of more than 83 million tonnes.

Besides the involvement of Indian firms in pipeline projects, Mr. Aiyar's agenda at the meeting included OVL's interest in stake in Sibneft,

Russia's fifth-largest oil producer, which is being bought over by the Russian gas monopoly Gazprom for $12 billion. The OVL's investment radar is also scanning a smaller firm, Severnaya Neft. — PTI

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