JOGMEC, Gazprom Neft to Study Gas Potential in East Siberia

Japan Oil, Gas and Metals National Corporation (JOGMEC) has announced that it will team up with Gazprom Neft in order to identify the oil and gas potential of Gazprom Neft's Ignyalinsky licence block.

An agreement between the two was signed at the recent St. Petersburg Economic Forum. The deal was signed between Vadim Yakovlev, First Deputy CEO of Gazprom Neft, and Hironori Wasada, Executive Director, of JOGMEC.

The agreement will see the two undertake a joint study on the asset which is 100 per cent owned by Gazprom Neft. As part of the study, the two will conduct 3D seismic study on the block, on an area of at least 450 square kilometres, and well drilling, to begin by the end of 2013. Tests will be completed on two existing wells and two new wells will also be drilled.

Following this activity, the two companies will then decide whether to further their cooperation on the Ignyalinsky block.

A statement from JOGMEC says the block location is ideally located for future activity, close to necessary amenities.

"As the block is surrounded by several oil and/or gas fields such as Verkhnechonskoye and Talakanskoye fields and is situated in close to the East Siberia-Pacific Ocean Pipeline (ESPO), the synergy of these would back up the early development of future commercial-scale discoveries," the statement read.

Gazprom Neft said the study would allow the company to make financial decisions on the block, once potential reserves and prospects had been identified.

"Eastern Siberia is one of the new regions where Gazprom Neft is becoming active.," First Deputy CEO of Gazprom, Vadim Yakovlev said. "The joint study of reserves in the Ignyalinsky licensing block will allow us to better understand and evaluate the prospects for developing the field. Once completed, we can then take necessary investment decisions."

The agreement is subject to approval from the Japanese and Russian authorities and Gazprom Neft's Board of Directors.