Turkmenistan Raises Huge Gas Field Reserve Estimate

Source: Reuters 4/14/2010, Location: Asia

Central Asia's top gas producer Turkmenistan said its largest gas field South Iolotan could hold up to 16 trillion cubic metres (tcm) of gas, updating the earlier estimated ceiling of 14 tcm.

UK firm Gaffney, Cline and Associates audited the field in 2008 and has said it contained between 4 and 14 tcm of gas, making it one of the five largest deposits in the world.

"Today the maximum estimate has risen to 16 tcm," Deputy Prime Minister Baymurad Khodjamukhamedov told an energy conference, adding the review followed drilling at the field.

He did not say whether the minimum estimate had been changed.

The former Soviet republic signed contracts worth $10 billion with China's CNPC, South Korea's LG International and Hyundai UAE's Petrofac Emirates last year to develop South Iolotan.

But the companies work under so called "service contracts," where they provide services such as building processing plants in exchange for fixed fees and do not get a share of output.

Foreign firms have long eyed South Iolotan and other potentially lucrative onshore Turkmen fields, looking to get development rights under production sharing agreements (PSAs).

However, Turkmenistan says it will retain all onshore deposits and only offers riskier offshore blocks for PSAs. "To make sure all of you are aware of this and there is no misunderstanding, Turkmenistan invites foreign companies only to provide services (onshore)," Khodjamukhamedov said. "We offer offshore blocks under PSAs."

Analysts say this policy limits foreign investment in Turkmenistan but the government forecasts large capital inflows. Yagshigeldy Kakayev, the head of state agency for hydrocarbon resources told the same conference Turkmenistan expected to attract $60 billion in investments into offshore Caspian production in the next decade. Turkmenistan produces about 75 billion cubic metres of gas a year and plans to triple output by 2030. It exports gas to Russia, China and Iran.

Turkmenistan has said it could supply gas for the planned Nabucco pipeline that would go to Europe bypassing Russia but that would require a new link across the Caspian.


Related Categories: Formation Evaluation  General  Geological, Geophysical  Geophysical Contractors  Mud Logging  Reservoir Engineering & Recovery Methods  Seismic survey  Well Completion, Logging, Workover 

Related Articles: Formation Evaluation  General  Geological, Geophysical  Geophysical Contractors  Mud Logging  Reservoir Engineering & Recovery Methods  Seismic survey  Well Completion, Logging, Workover 


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