By Aynur Jafarova
Uzbek state-owned holding company Uzbekneftegaz and British Tethys Petroleum Limited have signed a protocol of intent for exploration work on the Bayterek block in the Ustyurt basin in northern Uzbekistan, Tethys said in a press-release.
According to the company, the protocol of intent on the Bayterek investment block follows on from the previous Memorandum of Understanding and the agreement on the basic principles of the exploration agreement between Uzbekneftegaz and Tethys.
Tethys jointly with the Institute of Uzbekneftegaz's Geology and Exploration of Oil and Gas Fields has developed an exploration program for the Bayterek block. The program is expected to be approved by the Uzbek government.
Tethys and Uzbekneftegaz intend to sign an agreement on carrying out geological exploration on the Bayterek block in accordance with the Uzbek legislation within one calendar year, the report says.
Executive Chairman and President of Tethys David Robson said that the signing of the protocol of intent is a significant step forward with Uzbekneftegaz to work together on exploring the north-west of Uzbekistan.
"We believe this area has great exploration potential and we look forward to using our working knowledge of the area to best exploit this attractive block," he said.
As previously reported, in November 2011, Uzbekneftegaz and Tethys Petroleum signed a protocol of intent envisaging the conclusion of two new contracts to increase the production rate at two oil fields - Chegara and West Kruk in the Kashkadarya region, south of Uzbekistan.
In May 2012, Uzbekneftegaz and Tethys signed a contract on the implementation of the project on enhancing oil recovery at the Chegara field. In April this year, Tethys started its implementation.
The project envisages the implementation of a drilling program, including with the use of horizontal drilling, which covers the period until 2020. Tethys's total investment in the project's implementation will amount to $24.4 million.
According to the Uzbek side, the design capacity of production from the field could be around 390 tons of oil per day.
Currently, Tethys Petroleum is carrying out a project to increase production of liquid hydrocarbons in the North Urtabulak field in the Kashkadarya region.
In 2010-2011, the company carried out drilling of horizontal wells at the field to increase production. The drilling contractor is Chinese Xibu Drilling. Currently, North Urtabulak produces about 1.5 million barrels of oil per day.
Tethys Petroleum Limited is an oil and gas exploration and production company focused on the exploration and development of oil and gas fields in Central Asia, in particular Kazakhstan, Tajikistan and Uzbekistan. It is the only independent oil and gas company operating in all the three republics.