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NOVATEK Takes a Pass on Libya
NOVATEK will not take part in Libya's first tender for geological exploration and production of natural gas. It is not known yet whether LUKOIL will take part in that tender. One of its employees, head of the company's Libyan office Alexander Tsygankov, was recently arrested in Tripoli on suspicion of commercial espionage. NOVATEK claims that its decision is based solely on economic considerations. Gazprom will take part in the tender. The licenses for 12 lots with a total area of 72,500 sq. km. will be put up for auction on Sunday. Gasprom Libya B.V., Lukoil Overseas Holding and Novatek JSC are among the 35 companies that were originally expected to take part in the tender.
Libya has proven reserves of 1.5 trillion cu. m. of natural gas. That is the fourth largest reserves in Africa, behind Algeria, Nigeria and Egypt. It produces 7 billion cu. m. of gas a year, 83 percent of which is used domestically. The reserves on the lots up for auction have not been made public.
A Kommersant source close to the situation confirms that NOVATEK is backing out of the tender for economic reasons – the high amount of investment needed in the lots – and not political considerations. The company also wants to raise its production at the Yukharovskoe deposit in Russia from 9.6 billion cu. m. last year to 24.6 billion cu. m. of gas in 2010. In September, NOVATEK acquired 50 percent in a concession for exploration on the El-Arish bloc on the Egyptian shelf of the Mediterranean Sea, which NOVATEK president Leonid Mikhelson said would require $40 million in investments in the course of four years. He added that a number of other projects in the region were being considered, some jointly with the French company Total.
www.kommersant.com
All the Article in Russian as of Dec. 07, 2007
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