Page 12 - FSUOGM Week 26
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FSUOGM POLICY FSUOGM
Ukraine reveals PSA auction results
UKRAINE
THE Ukrainian government has announced the result of a landmark tender for production-shar- ing agreements (PSAs) at nine oil and gas blocks spanning 11,400 square km of acreage.
In a statement on July 1, the country’s energy ministry said it had received 23 bids from 14 companies in the contest, with seven Ukrainian, US and Canadian operators selected to develop sites. ose with successful bids are set to invest $430mn in 3D seismic data collection and explo- ration drilling over the next ve years.
UkrGasVydobuvannya (UGV), the coun- try’s biggest producer that serves as the main upstream arm of state-run Naftogaz, was awarded PSAs for the Buzivska and Betestianska blocks, located in east and west Ukraine respec- tively. e company li ed almost 15.5bn cubic metres of gas in 2018 – more than three quarters of Ukraine’s total output. It aims to ramp up pro- duction to 20bn cubic metres by the early 2020s.
UGV teamed with Canada’s Vermilion Energy, which controls upstream assets across Europe, to secure two more contracts for the Balakliyska and Ivankivska plots. Both span
sections of Ukraine’s eastern Dnipro-Donets petroleum basin. Another PSA was handed to US-based Aspect Energy for Varvinska block, also in Dnipro-Donets.
e four remaining contracts went to private Ukrainian operators DTEK, GeoAlliance, Ukr- na oburinnia and Zakhidnadraservis, which belong to local oligarchs Rinat Akhmetov, Victor Pinchuk, Ihor Kolomoisky and Zinovy Kozytsky.
Under the PSA terms, if the selected opera- tor makes a discovery it will receive 64-70% of production revenues until it has recovered its costs, while the Ukrainian state will secure a share of 12-35% of pro t oil. e royalty tax rate on liquids production for PSAs is currently 2% in Ukraine, while the rate for gas extraction is 1.25%. PSA holders are also subject to corporate income tax, VAT, personal income tax and uni- ed social contributions (USCs).
Ukraine has o ered up dozens of onshore oil and gas blocks this year in a drive to spur invest- ment and expand oil and gas production. It is also staging a contest for rights to a 9,500-square km o shore block in the Black Sea.
PROJECTS & COMPANIES
Rosneft brings new Orenburg field on stream
RUSSIA
RUSSIAN oil major Russia has reported a fresh oil nd in the Orenburg region bordering Kazakhstan.
The company issued a statement on June 28 saying it had identi ed a new eld named Kornilovskoye, a er drilling a well that owed 45 cubic metres of oil per day. e deposit holds 3mn tonnes (22mn barrels) of recoverable crude, it said.
Rosneft’s main production division in the region is Orenburgne , which operates around 130 licence areas across the Volga-Urals petro- leum basin. e latest discovery was made at the Kornilovsky block, which Orenburgne secured rights to in 2011. Prior to drilling, the company had collected 554 square km of 3D seismic data at the site.
Kornilovskoye is located in close proximity to several other Orenburgne assets. Rosne has cleared the eld for development, with plans to sink 20 production wells and build an 18-km
pipeline to pump its output to the nearby Gor- noye eld for processing and transport.
Many of Orenburgneft’s fields are mature, with some of the larger deposits having first entered operation in the 1960s and 1970s. In an effort to bolster production, the company has deployed enhanced oil recovery (EOR) techniques at its older assets, while expand- ing its search for new elds to exploit. In April it reported the launch of three new discoveries – Volostnovskoye, East-Volostnovskoye and South-Volostnovskoye – estimated to contain almost 40mn barrels in AB1B2 reserves.
So far these e orts have failed to arrest out- put decline. e company produced 322,200 barrels per day (bpd) of oil last year, down from 344,100 bpd in 2017 and 371,800 bpd in 2016. It controlled 2.11bn barrels of proven and 1.39bn barrels of probable oil reserves at the end of 2018, according to DeGolyer & MacNaughton.
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w w w . N E W S B A S E . c o m Week 26 03•July•2019
