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Lukoil to invest $2 bln to develop Saudi Arabian field

OAO Lukoil, Russia's largest oil producer, plans to invest about $2 bln to develop a Saudi Arabian field, after the company found natural gas and gas condensate at its first well in the Middle Eastern country.

OAO Lukoil found an estimated 620.5 million barrels (85 million tons) of hydrocarbons at Block A in the northern Rub al-Khali basin, said Grigory Volchek, a spokesman at Lukoil Overseas Holding Ltd. The company estimates the whole deposit may hold about 700 million tons of oil equivalent. „This is the first discovery a Russian company made in the post-Soviet period in Saudi Arabia,” Volchek said in phone interview from Saudi Arabia.

Lukoil owns 80% of the rights to develop the 30,000-square-kilometer (12,000-square-mile) Block A, south of Ghawar, the world's biggest oil field. The Russian company plans to produce as much as 20% of oil and gas outside of Russia by 2016, up from the 7% share last year. Lukoil plans to start production at the field in 2014 and produce 70 billion cubic meters of gas and 45 million tons of gas condensate over the 25-year contract. The Block A eastern part, „mostly examined by the company,” may hold 231.8 million tons of oil equivalent, Volchek said. (Bloomberg)