By OGJ editors
HOUSTON, July 1 -- ConocoPhillips and OAO Lukoil jointly announced the June 30 finalization of their OOO Naryanmarneftegaz joint venture to develop Lukoil's reserves in the northern Timan-Pechora area.
ConocoPhillips invested $500 million for its 30% interest in the joint venture. Lukoil holds 70% interest.
The JV, to be governed equally by Lukoil and ConocoPhillips, is expected to produce and market 200,000 boe/d of oil at its peak, expected in 2008. Production will be transported via pipeline to a terminal at Varandey Bay on the Barents Sea.
Lukoil plans to expand the terminal's capacity to 240,000 boe/d of oil in 2007 with ConocoPhillips participating in the design and financing the expansion.
Naryanmarneftegaz is part of a larger strategic alliance between ConocoPhillips and Lukoil that was formed last year (OGJ Online, Sept. 29, 2004). Through this alliance, ConocoPhillips acquired an 11.3% ownership of Lukoil's ordinary shares, and it has an option to increase its total Lukoil ownership stake to 20%.
