RFE Oil

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RFE Oil Gas Projects
Andrey Vasenev BISNIS
Representative, US
Department of Commerce
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(No Transcript)
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Sakhalin -1

• www.sakhalin1.ru
• Three offshore fields Chayvo, Odoptu, and
  Arkutun Dagi.
• Potential recoverable resources are 2.3 billion
  barrels oil and 17.1 trillion cubic feet of gas.
• One of the largest single foreign direct
  investments in Russia. Capital investment over
  the life of the project could reach as much as
  US12 billion.
• The initial phase develops the Chayvo field with
  production start-up targeted for the
  3Q2005

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Sakhalin-1 (continued)

• The Chayvo field - both offshore and onshore
  facilities.
• Yastreb land rig - constructed in 2002
  Extended Reach Drilling (ERD) technology five
  ERD wells have been drilled to-date.
• Orlan offshore platform, operated year-round.
• Processing at the Chayvo Onshore Processing
  Facility (OPF).
• Installation of Orlan at Chayvo is scheduled for
  summer 2005.
• Onshore Processing Facility will produce at the
  rate of approximately 250,000 barrels of oil and
  800 million cubic feet of gas per day.
• The pipeline construction from the Chayvo OPF to
  the DeKastri export terminal on the Russian
  mainland to be completed at the end of 2005.

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Sakhalin-1 Phase 1 Facilities
www.sakhalin1.ru
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Sakhalin-2

• www.sakhalinenergy.com
• Piltun-Astokhskoye, primarily an oil field with
  associated gas and Lunskoye, a gas field with
  associated condensate and an oil rim (both fields
  contain over 1 billion barrels of oil and 18
  trillion cubic feet of gas.
• Phase 1 focused on oil development and went into
  seasonal production during the summer period in
  1999 at the Vityaz Production Complex. Currently
  limited to the ice-free period about 180 days.
• Phase 2 is an integrated oil and gas development
  that will allow year-round oil and gas
  production. It will involve a further investment
  of approximately US10 billion.
• Currently under construction pipelines LNG
  plant

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Sakhalin 4, 5

• In 1998 the Alliance between JSC NC Rosneft
  (25.5) and PJSC NC Rosneft - Sakhalinmorneftegas
  (25.5) and BP (49) under Sakhalin V was formed.
• In 2001 Sakhalin IV went under the Agreement on
  the Alliance between JSC NC Rosneft/PJSC NC
  Rosneft - Sakhalinmorneftegas and BP.
• Blocks - Sakhalin IV
• Zapadno-Shmidtovsky
• Sakhalin V
• Vostochno-Shmidtovsky, Kaygansko-Vasyukansky
• Estimated reserves

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Sakhalin Market Access

• Visit the region
• Difficulties finding personnel/distributors
• Office space
• Trade missions
• Popular trade events
• www.sakhexpo.ru
• www.ibcenergy.com/sakhalin  
• www.paccomexpo.com

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Khabarovsk Krai

• Construction of an oil-loading terminal in
  De-Kastri (12.5 million tons per year)
• Sakhalin-Khabarovsk gas pipeline
• Delivery of natural gas to the Krai under the
  Sakhalin-1 project.

• Contact
• KHABAROVSK KRAI GOVERNMENT
• DIVISION OF GASIFICATION AND IMPLEMENTATION OF
  OIL GAS PROJECTS
• 56 Karl Marx Street KHV 680000
• Tel [phone]
• Fax [phone] or 325 040
• Email pilguy_at_adm.khv.ru
• Valeriy D. Pilguy, Head of the Division

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Yakutiya

• export-oriented East Siberia oil delivery project
  
• exploitation of Chayandinskoye oil and gas
  condensate field
• start up of oil processing facilities in the
  Western Yakutiya

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Development of Chayandinskoye Oil Gas
Condensing Deposit

• Project Description
• The project envisions development of
  Chayandinskoye oil gas condensing deposit, gas
  transportation to the export gas main and its
  export. Chayandinskoye deposit alone accounts for
  more than half of all oil gas reserves
  prospected in Sakha Republic (Yakutia).
• Product residue gas, crude oil, condensate,
  ethane, propane, butane, helium
• Consumer Market Russian Eastern Siberia and Far
  East, and PRC, primarily China, South Korea and
  Japan
• Project Cost 4,060 million
• Requested Investment Volume 4,060 million
• Form of Investments capital investments
• Debit Items
• drilling - 558.7 million
• field facilities construction - 2,811 million
• Chayanda-Talakan pipeline - 576.5 million
• gas processing plant - 110.3 million
• Implementation Term 50 years
• Viability Period 11.5 years
• IRR 19.4

• Contact
• Ministry of Industry of Sakha (Yakutiya) Republic
• Aleksey Struchkov, Minister
• 12 Kirov Street
• Yakutsk 677000, Russia
• Tel [phone]
• Fax [phone]
• E-mail minprom_at_optilink.ru, minpromsakha_at_mail.ru

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Production of Synthetic Fuels from Natural Gas in
Yakutsk

• Project Description
• The project envisions construction of a synthetic
  fuels plant to produce petrol and diesel fuel in
  Yakutsk. Sakha (Yakutiya) Republic yearly
  imports about one million of light oil products
  from other regions of Russia. However, Yakutiya
  disposes of enough hydrocarbon reserves to
  produce its own oil products. The plant will
  operate on reserves from Vilyuisky gas condensing
  deposits.
• Project assessment
• Project Cost 244.8 million
• Requested Investment Volume 108.8 million
• Form of Investmentsjoint venturelong-term loan
• Debit Items
• capital investments
• working capital
• annual running costs
• Implementation Term 20 years
• Viability Period 6.4 years
• IRR 31.7
• Form of Investment Return individual agreement

• Contact
• Ministry of Industry of Sakha Republic
• Aleksey Struchkov, Minister
• 12 Kirov Street
• Yakutsk 677000, Russia
• Tel [phone]
• Fax [phone]
• E-mail minprom_at_optilink.ru, minpromsakha_at_mail.ru
  

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Magadan Oblast Projects

• Exploration and development of oil gas deposits
  offshore the Sea of Okhotsk Magadan-1 and
  Magadan-2 Leasing Areas
• Brief description exploration and development of
  hydrocarbons on a lease sale basis and in
  compliance with Russian Tax Law. The entire
  project area is 30,200 sq. km the assessed
  hydrocarbons reserves are 2.65 billion tons
  hosted in 29 trap structures. The proposed
  project life span is 50 years. The leasing areas
  are included in the Lease Program of the Ministry
  of Natural Resources each site is divided into
  two blocks subject to licensing.
• The area shelf areas of the Sea of Okhotsk
  contiguous to Magadan Oblast
• The total cost 80.0 billion (expert judgment)
• Requested investments 20.0 billion (expert
  judgment)

• Exploration and development of oil gas fields
  offshore the Sea of Okhotsk Magadan-3 and
  Magadan-4 Tracts
• Brief description exploration and development of
  hydrocarbons on a lease sale basis and in
  compliance with the Russian Tax Law. The entire
  project area is 26,400 sq. km the assessed
  hydrocarbons reserves are 2.3 billion tons hosted
  in 16 trap structures. The suggested project life
  span is 50 years. The leasing areas are included
  in the Lease Program of the Ministry of Natural
  Resources each site is divided into two blocks
  subject to licensing.
• The area shelf areas of the Sea of Okhotsk
  contiguous to Magadan Oblast
• Total cost 70 billion (expert judgment)
• Requested investments 17.0 billion (expert
  judgment)

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Magadan Oblast Contacts

• The Department for Minerals Management of Magadan
  Oblast Administration
• 14 Proletarskaya Street
• Magadan, Russia 685000
• Aleksandr Nevolin, Director of the Department
• Tel [phone]
• Fax [phone]
• E-mail nedra_at_regadm.magadan.ru
•  

• Magadan Territorial Agency for Minerals
  Management
• 11 Proletarskaya Street
• Magadan, Russia 685000
• Vyacheslav Kobets, Head of the Agency
• Tel [phone]
• Fax [phone]
• E-mail kpr_at_mfgi.magadan.ru
• geolcom_at_online.magadan.su

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Amurskaya Oblast Extending Oil Main to China

• Transneft JSC and the Chinese National Power
  Corporation (CNPC) developed a project on
  construction of Skovorodino Chinas border oil
  pipeline.
• The pipeline will be an offshoot of the Eastern
  Siberia Pacific Ocean oil main.
• The pipe length from Skovorodino to Zhalingda
  Settlement (China) will total 65-82 kilometers.
• The initial oil supplies to China will vary
  within 15 million tons a year
• Supplies will double once the oil pipeline is
  finalized.
• Construction period - about 20 months,
• In 2005, China consumed 341 million tons of oil
  that was 9 percent of the world oil consumption.
  Russia and Kazakhstans share in oil supplies to
  China did not exceed 12 percent

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RFE Gasification Program

• Development of the unified system for production,
  transportation and distribution of gas in the RFE
  and Eastern Siberia with a potential outlet to
  Pacific Rim Countries.
• Overall reserves of gas in Eastern Siberia and
  the RFE are estimated at 64 trillion cub. m. (27
  of Russias total).
• completion of the Okha Komsomolsk-on-Amure
  Khabarovsk gas pipeline and its extension up to
  Vladivostok (Primorskiy Krai).
• RFE gasification program envisions
• - development of six large deposits,
• - construction of over 5,600 thousand
  kilometers of pipelines,
• - 17 compressor stations with the total capacity
  of 980 MVt,
• - gas processing plant and two helium storage
  facilities as well as three underground gas
  storage facilities.

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RFE Gasification Program - continued

• Eight oil and gas projects are implemented today
  under federal and regional target programs in the
  Russian Far East.
• Fifteen structures are currently being
  constructed under these projects.
• - The construction of the third line of the
  Sredneveluiskoye gas condensate deposit -
  MastakhBergeYakutsk trunk pipeline (Yakutiya)
• - Development of Zapadno-Ozernoye Gas Deposit
  (Chukotskiy Autonomous Region)
• - Komsomolsk-Khabarovsk Gas Pipeline