Turkmenistan is on brink of "oil boom" in Caspian

Turkmenistan, Ashgabat, June 8 / Trend , G.Hasanov/

Turkmenistan, followed by the other Caspian countries - particularly Azerbaijan and Kazakhstan, has set itself the ambitious plans for the development of the Caspian Sea shelf.

Under the estimates of American Western Geco Geophysical Company, reserves of the Turkmen sector of the Caspian Sea shelf make up 11 billion tons of oil and 5.5 trillion cubic meters of gas, without taking into account the already contracted blocks. The Turkmen sources said it is more than half of oil resources and about one quarter of the gas in the entire country.

Due to the expansion of the hydrocarbon resource potential and introduction of the latest Western technology - to a greater extent in the Caspian Sea, which requires a significant investment because of the inaccessibility of fields - by 2030, Turkmenistan will annually produce up to 250 billion cubic meters of gas and 110 million tons, respectively, compared with the current 70 billion cubic meters of gas and 10 million tons of oil.

Annual volume of direct investment from abroad should be closer to $ 10 billion for efficiency of the Turkmen fuel and energy complex. In 2009, the investment influence is projected to amount to $4 billion, while last year 2.3 billion was invested, about $900 million in 2007 and roughly 650 million in 2006.

According to official Turkmen sources, 32 licensed blocks have been put for the international tender. The negotiation process include U.S. Chevron, ConocoPhilips, Marathon, Midland Oil & Gas, British British Petroleum, German RWE, Austrian OMV, Norwegian Statoil Hydro, French Total, Russia's Itera, Lukoil and several companies from the Far East and the Persian Gulf. Practically, all of these companies opened their offices in Ashgabat. The source close to the negotiations said that technical discussion of the projects is currently launched and singing a series of oil and gas contracts is not so far.

"A broad interest of foreign companies in this area (the Caspian) is caused by the great potential of hydrocarbon raw materials, favorable geographical position at the crossroads of Europe and Asia, a stable political situation in our country and guarantees fixed by legislation for foreign investments," Chairman of State Concern" Turkmenneft " Tashliev Garyagdy said at a conference.

Specialists of the state concern "Turkmenneft" claim in their reports that more than 80 percent of hydrocarbon reserves in offshore sediments are located at a depth of 3,000 meters, as well as in a weakly-studied oil and gas zones, so it is possible to reveal new significant oil and gas fields . New prospects are mainly associated with two major oil and gas basins - the Middle Caspian and South Caspian. At one time, U.S. experts of Western Geco processed over 16,000 linear kilometers of seismic, but they first had to obtain reliable information about the deep geologic boundaries. This was the basis of technical base to estimate and classify hydrocarbon potential Turkmen sector of the Caspian Sea, as well as identify further strategies to attract foreign investment in projects of exploration and production of oil and gas.

According to the State Agency on hydrocarbon resources under the president, Turkmenistan permits to foreigners, three forms of cooperation: the agreement on production sharing, joint ventures and the attraction of services. Under the plans, the share of hydrocarbon production by foreign companies will continue to grow. In the coming years, the country will make a real impact on the cost-decade exploration companies working in the Production Sharing Agreement (PSA). Turkmenistan is currently implementing 7 projects, including four in the Caspian shelf, with the oil and gas companies from ten countries - Austria, Britain, Germany, Italy, India, Malaysia, UAE, Denmark, Canada and China.

If the thing is only about the marine projects, their leaders appeared here. The first line belongs to Dragon Oil (United Arab Emirates, United Kingdom) - which in 2005 approached the million mark of oil production and is actively selling Turkmen oil via Azerbaijan and Iran. Also, the state Petronas Charigali (Malaysia), which is preparing for the next two years to become the first in Turkmenistan offshore foreign gas producer - with the ability to offer the world market of almost 10 billion cubic meters of gas a year.

Exploration work is conducted on two PSA agreements at this stage of the Caspian Sea. Under the contract signed in 2002, three companies - the operator Wintershall holding AG of Germany, the Danish Maersk oil and Indian ONGC Mittal Enerji Ltd are working on a contract area of the Block 11-12 employs. In 2007, Burried Hill from Canada launched its activity on a contractual territory of the Block-3.

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