Bakrie signs $600 million oil, gas deal in Uzbekistan
Bakrie signs $600 million oil, gas deal in Uzbekistan
TASHKENT (Reuter): Private Indonesian energy company Bakrie has signed a deal to spend US$600 million to develop oil and gas fields in Uzbekistan, Robert Sutrisno, Bakrie's director for Uzbekistan, said yesterday.
"It is the most major investment decision we have taken in this country," Bakrie told Reuters. "It is a memorandum of understanding with the State Property Committee, but I see it more, in a sense, as a letter of agreement."
He said the investment would go partly toward rehabilitating oil fields as well as toward secondary oil production and output of gas and gas condensates in the Central Asian state.
No details were available on which energy-bearing deposits in the former Soviet republic Bakrie would develop.
In a related development, Uzbekistan has renewed offers to foreign firms to explore and develop five big oil, natural gas and gas condensate projects, said Khudaykul Zhumayev, deputy head of state energy concern Uzbekneftegaz, late on Thursday.
Some of the projects had already been offered to investors in a tender in 1993, but the deals did not go through because of "a number of reasons", according to an official Uzbekneftegaz document.
Uzbekistan has struggled to raise foreign investment in exploration and development of its energy reserves since independence from Moscow in 1991.
At least one production project could take off soon. Enron Oil & Gas Co of the United States and Uzbekneftegaz may create a joint venture by the end of this year to develop natural gas fields.
The new project proposals would not be based on a tender as in 1993, but on negotiations with individual companies which have already begun, the document said.
"We are holding talks with Agip SpA, Mobil Corp, Unocal, Delta Oil and Enron on these projects," Zhumayev said.
He said estimated reserves for the five projects were around 2.0 trillion cubic meters of natural gas, 3.65 billion tons of oil and 302 million tons of gas condensate.
The former Soviet republic has said it plans to produce 8.0 million tons (160,000 barrels per day) of oil and gas condensate in 1997, up from 7.7 million tons (153,200 bpd) in 1996.
The Central Asian state expects to boost oil and condensate further to 10.0 million (200,000 bpd) by 2000.
It does not expect to boost gas output significantly in the short term from around 50 billion cubic metres it produced last year.
The mostly desert nation of 23 million sits on total estimated reserves of 4.4 billion tons of oil, 629 million tons of condensates and 5.4 trillion cubic meters of gas.