OREANDA-NEWS. July 02, 2012. Bashneft took part in the final stage of the Fourth licensing round held in Baghdad on May 30-31, 2012 by the Iraqi Ministry of Oil. As part of a consortium with PVEP and Premier Oil, Bashneft bid for Block 10 and Block 12.

As a result of further negotiations initiated by Bashneft, the Iraqi Ministry of Oil granted the Russian company the right for exploration and development of Block 12 with a fee of USD 5 per barrel of oil equivalent.

Further, the Iraqi Ministry of Oil granted Bashneft the right to operate hydrocarbon exploration and development in Block 12. This means that the Group will be completely independent in making key decisions related to project implementation. Premier Oil remains Bashneft’s partner in this project.

"We are satisfied that our efforts to find and evaluate promising international projects have produced the first tangible result," stated Alexander Korsik, the President of Bashneft. "The fact that Bashneft has been given the right to operate hydrocarbon exploration and development of the Block 12 indicates that Bashneft’s experience and professionalism is recognized internationally. This is an important milestone in the implementation of our strategy towards entering new operating regions." On June 28, the President of Bashneft Alexander Korsik and the Iraqi Minister of Oil Abdul Kareem Luaibi had a meeting in the Iraqi Ministry of Oil, Baghdad, and discussed the issues related to project implementation.

NOTE: Block 12 is located in the Najaf and Muthanna provinces, approximately 80 km to the southwest from the city of Samawah and 130 km to the west from the city of Nasriya. It is a part of the Western Desert, which is an unexplored region having the greatest potential in Iraq in terms of oil production. The block’s approximate area is 8,000 sq. km.