A Russian drilling rio, will work in Peru for a private Peruvian firm under a novel arrangement.
Petro Andes Exploracion-Produccion SA, Lima, let contract to Sojuzkarta, Moscow, for a Russian drilling rig, related equipment, and technicians to drill wildcats in Peru.
The contract covers a BU 2500 DGU rig rated to 2,500 m supplied by Volgograd Drilling Equipment Factory, Volgograd, plus logging, cementing, and towing equipment, all to be delivered from St. Petersburg to Matarani, Peru, in late May. Total equipment cost is estimated at $5 million.
Sojuzkarta is financing the equipment purchase in exchange for payment in crude in the event of commercial discovery by Petro Andes, formerly VG Exploracion-Produccion.
Under the agreement with Sojuzkarta, Petro Andes will receive a canceled invoice for the equipment, allowing it to use the equipment as a guarantee to raise more funds for the exploration program. Sojuzkarta shot 100 line km of seismic survey in the Titicaca basin for Petro Andes and plans another 100 line km.
The first of two wildcats planned the next 2 years will be on the banks of Lake Titicaca about 10 km northeast of Juliaca.
The former VG signed in April 1990 a 30 year exploration and development contract with state owned Petroleos del Peru for the 1.23 million acre Block S-2 in the Titicaca basin. It signed another contract covering adjoining Block S-3 in December 1991.
Petro Andes has spent $1 million in exploration thus far.
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