Rosneft PJSC and the Kurdistan regional government (KRG) have signed production-sharing agreements for five blocks in the region.
Rosneft subsidiaries will hold 80% interest in the blocks, where a geological exploration program will be implemented and pilot production will begin as early as 2018. If successful, full-field development of the blocks will begin in 2021.
The company says “conservative estimates” show a possible 670 million bbl of recoverable oil from the blocks.
Costs related to the farm-in as well as geological information for each of five blocks range $40 million-110 million and could total $400 million, including $200 million that may be compensated through production, the company says.
The PSAs stem from a series of binding agreements signed in June related to widening cooperation between Rosneft and the KRG in exploration and production of hydrocarbons, commerce, and logistics.
Rosneft last month said it was advancing an agreement for construction of a natural gas pipeline able to supply electric power plants and factories in the Kurdish region of Iraq and to export as much as 30 billion cu m/year of gas to Turkey and Europe (OGJ Online, Sept. 19, 2017).
