TNK-BP, Gazprom to close Kovykta gas field deal by late April

Energy Trade

TNK-BP will close a deal to sell a stake in the East Siberian Kovykta gas condensate field to Russian energy giant Gazprom in late April, the Russian-British joint oil venture said on Thursday.

TNK-BP President Robert Dudley said he was “optimistic” the deal would be signed. The Kovykta deal is part of an agreement signed between Gazprom, Britain’s BP and TNK-BP in June 2007. Under the deal, Gazprom is to buy a 63% controlling stake in East Siberia’s largest deposit in late June as part of a strategic investment plan. A strategic alliance for long-term investment in joint energy projects and asset swaps in Russia and third countries was also envisaged under the agreement. TNK-BP, which is Russia’s third-largest crude producer, proposed its gas producing subsidiary, Rospan International, as a base for a joint venture with Gazprom.

The companies initially planned to close the deal within 90 days, but the deadline was repeatedly postponed. Viktor Vekselberg, TNK-BP’s executive director, said last December that the deadline for closing the Kovykta deal had been postponed for technical reasons. Gazprom cited the “high volume of work in evaluating the assets and organizing the transactions” as the reason for extending the timeframe. The deposit’s reserves are estimated at 2 trillion cubic meters of natural gas, 2.3 billion cubic meters of helium and 115 million metric tons of gas condensate. As well as TNK-BP, the operator of the project, Rusia Petroleum, is owned by Interros financial holding (25.8%) and the local administration (11.2%). (Ria Novosti)

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