Ukrainian-Iranian Company Invests USD 800 Million in Oil Fields

Kyiv, February 22, 2012. The Joint Ukrainian-Iranian company Inter Naft Gas Prom Pars signed a USD 800 million contract with Petroleum Engineering and Development Company, Iran. INGP Pars will invest in development of oil fields Koohmond, Boushkan, and Kouhkali in Iran, said Ahmad Qalebani, managing director of the National Iranian Oil Co. The estimated volume of oil reserves in the fields exceeds 2 billion barrels, reports Fars News Agency.

The Iranian oil fields will be developed in two stages. Around 11,000 barrels per day will be pumped out within the first stage of the project. By the second stage this number is set to double and reach the daily amount of 22,000 barrels. Koohmond, Boushkan, and Kouhkali boast respective reserves of 1 billion, 780 million, and 340 million barrels of oil each.

Another Ukrainian company – the largest in the country oil and gas producing state-owned entity Ukrnafta recently announced its plans to start at least 16 projects involving development of new wells (including 9 horizontal wells) in 2012. Ukrnafta’s projected investment in the drilling is set to exceed USD 53 million.

According to the 2010 annual Ukrnafta report, the company’s income in 2010 equaled USD 1.6 billion. At the time the company owned 2372 oil and gas wells on the territory of Ukraine. Over 2010 the state company introduced 20 new oil wells. Currently, the national company aims to diversify its raw materials supply by entering international market of oil and gas wells drilling, maintenance, and transportation of the resources.

At the moment, Ukraine is seeking to expand its energy sources and ensure national energy security in the wake of gas price conflict with Russia. Presently, Ukraine runs several National Projects aimed at improving country’s energy efficiency and finding new sources of energy. The government contemplates alternative gas supply options, as well as possibilities to substitute gas with coal, oil, and energy from alternative sources – solar, wind, biomass energy.

Last year the Prime Minister of Ukraine Mykola Azarov stated that the country needed some 20 million tons of oil per year. Emphasizing that extracting oil in Ukraine needs to cost less than buying it from other countries, Mykola Azarov projected that in a decade Ukraine would manage to extract 7 to 8 million tons of oil annually.