Rosneft Board of Directors has approved a document titled “The integrated project for the development of gas reserves (Cenomanian PK 1 and Turonian layers) of the Kharampur field.”
The development of the Kharampur gas field is an important step forward in implementation of the company’s Gas Strategy in a bid to raise the value of its gas business. The gas to be produced at Kharampur will be one of the key sources of supplies under the long-term contracts by Rosneft.
Phase 1 of the project envisages the production of more than 190 billion cubic meters of natural gas from the reserves of the Kharampur field. The production is set to kick off in 2017. The main Phase 1 target is the Cenomanian layer, which production is characterized by a high rate and low extraction costs. The plan is to produce up to 8 billion cubic meters of gas a year. Another 1 billion cubic meters will be produced from the Turonian layer, which is subject to significant MET cuts. The potential for an increase in the production at the field is associated with the full-scale development of the Turonian reserves.
The project will require about 1 billion rubles of investments into exploration for the period 2013-2014. Following pilot works at the hard-to-recover Turnonian layer, the company will choose the optimal well design and the most efficient technology of operation. Until now no Turonian gas production has ever been organized in the Russian Federation, which means the development of the Kharampur field will be able to bring some entirely new technological solutions into the national gas production sector. The decision on Phase 2 of the project, envisaging the annual production of 24 billion cubic meters of gas, is to be made in 2018.
Monetizing gas reserves is a strategic priority for Rosneft. The company has been steadily pursuing a program seeking to increase its gas output. The current plan is to reach production levels of 100 billion cubic meters of natural gas a year by 2020.