OREANDA-NEWS. October 17, 2007. JSC “Vercknechonskneftegas” (VCNG) plans to invest 13 billion rubles (US $521 million) in development of the Verkhnechonskoe oil and gas condensate field in 2008, which is 62,5% greater than the expected investment volume this year, stated the company’s General Director Mugammir Galiullin at a press conference, reported the press-centre of TNK-BP.

He noted that the company will direct $122 million toward drilling work next year, while it is planned to spend $78 million on drilling in 2007.  Vercknechonskneftegas will invest almost all the remaining money in creation of infrastructure (including construction of an oil pipeline).

According to M. Galiullin, the company’s main shareholders, Rosneft and TNK-BP, are financing the work in proportion to their shares in charter capital.

As JSC “TNK-BP Management” Gas External Affairs Director Sergey Tulinov informed Interfax, Vercknechonskneftegas plans to conduct operations on the basis of shareholders’ loans.  According to him, the company does not intend at present to attract funds through additional stocks offers.

The head of Vercknechonskneftegas reminded that the company built an intrafield pipeline (diameter 426 mm) in 2007.

M. Galiullin also noted that in February 2008 Vercknechonskneftegas will commission a 90-kilometer road from Verkhnechonskoe field to Talakanskoe field that runs parallel to the oil pipeline.  At the end of August, Vercknechonskneftegas began the first stage of the road.  The company is currently constructing bridges and surfacing the road.

Furthermore, Vercknechonskneftegas began construction of an electric power station.  The company intends to commission during the first stage a 6.6 MW block that operates using liquid and gaseous fuel.  Vercknechonskneftegas hopes to receive two gas turbine electric power stations in December that will operate using casinghead gas.  For now, the company plans to use associated gas for its own electric power supply, noted M. Galiullin.  The capacity of the electric power station may be increased to 150 MW in the future, and if electric power transmission lines will be built from Irkutsk Oblast to the Sakha Republic, then it will be possible to sell electric power to external consumers. 

As noted earlier, VCNG plans to build a pipeline 530 mm in diameter and 120 km long, and to begin supply of oil to the Eastern Siberia – Pacific Ocean (ESPO) oil pipeline.  Within the framework of full-scale development of the field, the company plans to achieve stable oil volumes of 7—20 million tons per year by the beginning of 2013. Projected investment in this project in 2007—2012 is estimated at 3 billion 280 million dollars.

Vercknechonskneftegas, formed in 2002, owns the license to produce hydrocarbon feedstock and study geologically the Verkhnechonskoe oil and gas condensate field.  Its category C1 oil reserves amount to 159,5 million tons, C2 reserves: 42,1 million tons, category C1 condensate: 0,4 million tons, C2: 2,9 million tons, category C1 gas: 11,7 billion cubic meters, category C2 gas: 83,8 billion cubic meters.