Russia's Gazprom Neft broadens operation in Iraq, Croatia

ST. PETERSBURG, April 7 (Itar-Tass) - Russian oil company Gazprom Neft stated Monday about new projects which are being prepared for implementation outside Russia. The first project concerns Iraq, the second one - Croatia, Central Europe. Some changes in the currency policy of the company are also planned. Commercial oil development at Iraqi oil field Badrah, where the company had received first oil in 2013, would begin in May, Gazprom Neft CEO Alexander Dyukov said. Oil output is planned at 350 thousand tonnes this year and more than one million tonnes in 2015. The company is expected to reach planned 8.5 million tonnes of oil annually by 2017. “Amount of our investments in the project is set within one billion dollars,” Dyukov said. Oil reserves at oil field Badrah in Wasit Province in eastern Iraq are estimated at three billion barrels. The contract for development of this oil field was signed in 2010 upon results of a tender, which the consortium of Gazprom Neft, South Korea’s Kogas, Malaysia’s Petronas and Turkey’s TPAO had won. Gazprom Neft is an operator of the project with planned investments of two billion dollars. Gazprom Neft also stated that the company intended to participate in a tender on oil and gas offshore deposits in Croatia without specifying which sections in concrete the company was interested in. All in all, 29 offshore zones in the Adriatic Sea will be put up for a tender for geological prospecting and further exploration. Receiving of bids will end on November 3 and tender results will be made public next year. As for Gazprom Neft operating activity in general, Dyukov noted that the company did not rule out possible conversion of deals with buyers from U.S. dollars to euro in case of force majeure circumstances. This will take place if sanctions against Russian business are expanded. “We have agreed with our buyers on possible conversion of the contracts in euro and practically all, to say precisely, 95 percent of purchasers confirmed that they were prepared to shift to settlements in euro,” he said. “In a vague situation over sanctions we have considered different scenarios, including a certain alternative plan. In essence, there is nothing impossible that you can convert the deals from U.S. dollars to euro and euro to roubles. Certainly, it is needed to explore effectiveness of this approach, this issue remains open personally for me,” he added. Read more on itar-tass.com