OREANDA-NEWS. December 04, 2009. I.V. Makarov, Chairman of the Board of Directors of ITERA Oil and Gas Company, LLC, and N.G. Brunich, General Director of OJSC Zarubezhneft  signed a Cooperation Agreement on Exploration and Production of Hydrocarbons in Block 21 in the Turkmen sector of the Caspian Sea, reported the press-centre of ITERA.

ITERA signed a Product Sharing Agreement (PSA) with the Government Agency on Control and Usage of Hydrocarbon Resources under the President of Turkmenistan in relation to block 21 of the Turkmen sector of the Caspian Sea in September of 2009. Commencement of the work in the field is planned for 2010.

According to preliminary assessment, the license block’s recoverable reserves of oil are 219 million tons, and that of associated gas are 92 billion cu m.  According to expertly assessments, non-associated gas reserves may be as big as 100 billion cu m. The planned maximum annual production of oil at the block is 11 million tons, and that of gas is 4.5 billion cu m. The Project is valued at up to US 6 billion.

The signed Agreement identifies the interfacing procedures which the parties shall follow in the joint implementation of the Project including exploration, development, construction and operation of the discovered hydrocarbon fields in the offshore block 21 based on the PSA terms. According to the signed document, OJSC Zarubezhneft is ready to buy from ITERA 51 percent of participation in the Project, while ITERA is to retain a 49 percent interest. For that purpose and in line with PSA provisions ITERA Oil and Gas Company applied to the Government Agency on Control and Usage of Hydrocarbon Resources under the President of Turkmenistan for permission to farm out the share in the Project.