Lukoil Finally Gets Stake in Kharyaga Field

Lukoil has, after much dispute with local authorities, finally been granted a 20% interest in the Kharyaga field in northern Russia. Two years ago Lukoil agreed to assist TotalFinaElf and Norsk Hydro in developing the field in exchange for a 10% stake from each company. Approval was finally received from the Russian government last November, however, the deal was put on hold by the local authorities, whose approval is also needed. The governor of the Yamal-Nenets region has finally signed-off on the deal. "We are deeply satisfied by improving cooperation between Lukoil and the administration ... and are confident the signing of the deal will give a new impulse to the the Timan-Pechora oil province development," Lukoil said.

Partnership in the field will now be TotalFinaElf with 40%; Norsk Hydro with 30% and Lukoil with the remaining 20%. The Kharyaga production sharing agreement was signed in 1995 and produces 30,000 barrels per day. The field's recoverable reserves are estimated at 710 million barrels.