International Projects

Badra

As part of the second licensing round in December 2009, Gazprom Neft obtained the right to develop the Badra field as part of a consortium. The Company owns a 30% stake in the project and performs operator functions. The consortium is comprised of: Gazprom Neft, Kogas (South Korea), Petronas (Malaysia) and ТPАО (Turkey). Gazprom Neft has a 30% stake in the project, Kogas — 22.5%, Petronas — 15% and ТPАО — 7.5%. The Iraqi government, which is represented in the project by Iraq’s Oil Exploration Company (OEC), has a 25% stake in the project.

The service contract was signed on 28 January 2010 and took effect on 18 February 2010.

Geography of the project

The Badra oil field is located in Wasit Province in eastern Iraq.

Project history

2013

Successful testing of Well BD 4 completed in late December.

2014

First oil obtained.

Field begins commercial operation stage and production drilling starts.

First stage of a central production facility with capacity of 45,000 barrels is built and commissioned.

Oil export pipeline commissioned to connect the field with the main pipeline system of Iraq. Start of commercial oil shipments. Raw commodities in an amount of more than 15,000 barrels per day entered the Iraqi pipeline system for shipment to the export terminal in Bara (Persian Gulf).

Well P8 drilled ahead and three wells in the process of drilling as part of a contract concluded with Zhongman Petroleum and Natural Gas Group Co., Ltd. (ZPEC) for the drilling of production wells.

Development and commissioning of three wells.

Final development plan submitted to Iraq.

FCP achieved (95 days of producing 15,000 barrels over a 120-day period).

„The consortium of companies led by Gazprom Neft has fully prepared one of the most complex Iraqi fields in terms of geological structure — Badra — for full-scale development in just a few years. This is the Company’s first major foreign project in the production segment implemented from scratch. We have gained unique experience that we can apply in the future when developing other new fields both in Russia and abroad”.

Alexander Dyukov Chairman of the Management Board of OJSC Gazprom Neft

Project development plans

Continued production drilling.

Conclusion of contracts for the drilling of the next production wells.

Commissioning of three wells.

Commissioning of a second oil treatment line of the central production facility and related infrastructure.

Conclusion of a contract for the construction of a water pipeline for technical needs.

Share of Gazprom Neft in oil and hydrocarbon production at the Badra field
Share in hydrocarbon production at Badra, 1,000 TOE Share in oil production at Badra, 1,000 t Share in gas production at Badra, mn m3
2014 92.844 92.844
2013
2012
2011
2010

Kurdistan

In August 2012, Gazprom Neft joined new projects for the exploration and development of hydrocarbon reserves in Iraq. The Company signed two production sharing agreements with the Regional Government of Kurdistan for the Garmian and Shakal blocks with total area of 2,054 km2 located in southwest Kurdistan. In February 2013, a PSA was signed for the Halabja block with area of 1,519 km2.

Gazprom Neft has a 40% stake in the Garmian block. The Company has the status of project operator at the Shakal and Halabja blocks in which Gazprom Neft has an 80% stake. The Regional Government of Kurdistan has a 20% stake in all agreements. Gazprom Neft has plans to establish an oil production centre in the Middle East.

Gazprom Neft’s goal is to start the development and commercial operation of hydrocarbon reserves within the scheduled time frame, thereby establishing an oil production hub in the region.

Geography of the project

Southwest part of the Kurdistan Province in eastern Iraq.

2014

Unexplored part of the Garmian unit (93% of territory) commissioned in accordance with the terms of the Production Sharing Agreement.

The military and political situation deteriorated in Kurdistan in August 2014. The outbreak of hostilities in close proximity to the areas of operating activities of Gazprom Neft led to the suspension of operations at the blocks.

Despite the difficult military and political situation in the region, drilling of the Shakal-2 and Shakal-3 wells completed at the Shakal block in December 2014.

2D seismic survey fieldwork began at the Halabja block in September 2014.

Oil flow of 1,500 tonnes per day obtained at the Garmian block based on the testing results of the Sarkala-1 well.

Plans for 2015

Completion of 2D seismic survey fieldwork at the Halabja block and selection of the location of the first exploration well.

Function of operator at the Garmian block to be transferred from Canada’s Western Zagros Resources Ltd. to Gazprom Neft Middle East B.V. Oil production slated to begin at the block.

Completion of testing of Shakal-2 and Shakal-3 wells at the Shakal block. Decision to be made on the drilling of the Shakal-4 and Shakal-6 wells based on the testing results.

Junin-6

Gazprom Neft has an 8% stake in the project, including 20% in LLC National Oil Consortium.

Geography of the project

The Junin-6 block is located in the Bolivarian Republic of Venezuela in the heavy oil belt of the Orinoco River basin.

Project history

2009

Pursuant to the decisions under the Memorandum of Understanding between the companies OJSC Gazprom, OJSC Rosneft OC, OJSC LUKOIL, OJSC Surgutneftegas and OJSC TNK-BP Holding, the parties joined the charter capital of LLC National Oil Consortium (NOC). Given that the consortium’s Junin-6 project, which is being implemented as part of an intergovernmental agreement in Venezuela, is an oil production project, Gazprom Neft joined the charter capital of NOC in order to implement this project based on the decision of OJSC Gazprom management.

2010

LLC National Oil Consortium and Corporacion Venezolana del Petroleo (CVP), a subsidiary branch of Venezuelan state oil company PDVSA, registered the joint venture PetroMiranda for the development of the Junin-6 block in the heavy oil belt of the Orinoco River basin. NOC paid the first portion of a bonus amounting to 600 mn USD to the Bolivarian Republic of Venezuela for the right to take part in the joint venture.

Under the decision of the NOC Board of Directors, Gazprom Neft was appointed as the Junin-6 project leader responsible for its technical implementation, while OJSC TNK-BP Holding was designated as its partner for the organisation and implementation of the project.

2012

Start of the field’s pilot operation.

Drilling started on the first stratigraphic well J6-D12 as part of the Junin-6 block additional exploration programme. Oil saturated core obtained with an analysis showing the pin-point accuracy of the projected depth of the productive horizons, and reservoir capacity increased by 45%.

The NOC Board of Directors approved the “Early Production” project taking into account the Venezuelan side’s adoption of significant terms for the project’s implementation.

A ceremony devoted to the launch of the first horizontal well DB1-01 took place on the territory of the Junin-6 block and the first oil was obtained from the Junin-6 field (as part of the “Early Production” project). The ceremony was attended on Russia’s behalf by the executives of the NOC member companies led by Chairman of the NOC Board of Directors Igor Sechin, and on Venezuela’s behalf by the executives of PDVSA led by Venezuelan Minister of Oil and Popular Power Rafael Ramirez.

2013

Construction completed on three exploration wells, including one with core sampling, as part of the programme for the additional exploration of the block.

Construction completed on three horizontal wells as part of the “Early Production” project (pilot development stage), and the operating well stock included five wells at the end of the year. Average daily production under the project is approximately 371 tonnes per day (share of GPN — 30 tonnes per day).

Design work continued on ground infrastructure and the Upgrader (oil quality improvement plant).

In 2013, changes were made to the members of the NOC:

  • OJSC Surgutneftegas withdrew from the Junin-6 project, selling its 20% stake in NOC to OJSC Rosneft OC;
  • as a result of the acquisition of OJSC TNK-BP Holding by OJSC Rosneft OC, the former’s 20% stake in NOC increased the equity participation of OJSC Rosneft OC in the project;
  • OJSC LUKOIL informed NOC members about its intention to withdraw from the project;
  • NOC members decided to transfer management of the Junin-6 project from Gazprom Neft to a management company of OJSC Rosneft OC in 2014.

2014

Construction completed on one exploration well and a second well is in the construction stage as part of the programme for the additional exploration of the block.

Construction completed on 17 production wells as part of the “Early Production” project.

Operating well stock included 22 wells at the end of the year. Average daily production under the project is approximately 1,125 tonnes per day (including Gazprom Neft’s share of 90 tonnes per day).

Work continued on the design of ground infrastructure. Project management system altered in the Russian part of the Junin-6 project with management transferred to OJSC Rosneft OC.

OJSC LUKOIL withdrew from the project in December 2014, selling its 20% stake to OJSC Rosneft OC.

Share of Gazprom Neft in oil, gas and hydrocarbon production in the Junin-6 project
Year Share in oil production of NOC, 1,000 t Share in gas production of NOC, mn m3 Share in hydrocarbon production of NOC, 1,000 TOE
2014 20.957 20.957
2013 8.463 8.463
2012
2011
2010

Project development plans

First stage of additional exploration of block to be completed and second stage of additional exploration to begin.

Continued implementation of the “Early Development” project.

Continued work to design ground infrastructure.

Continued work to update Regulation N (Field Development Project) to the Contract on the Establishment and Management of PetroMiranda JV.