Gazprom Eyes 14.4Bcm Of Gas From Yuzhno-Russkoye In 08

LONDON, March 28, 2008 (Dow Jones Newswires)

Russian natural gas monopoly OAO Gazprom expects to produce 14.4 billion cubic meters of natural gas in 2008 from its Yuzhno-Russkoye gas field, which is expected to be the source for the Nord Stream pipeline project to Europe, a Gazprom official said in an interview published in the company's internal corporate magazine Friday.

Eduard Khudaynatov, general director of OAO Severneftegazprom, a Gazprom subsidiary which holds the license to the Yuzhno-Russkoye field in Western Siberia, said production at the field will reach annual production of 25 billion cubic meters of gas in 2009.

He said there are 52 production wells at the field, of which 42 are fully operational.

Khudaynatov also said the field's oil reservers are estimated at 5.7 million metric tons, or 42.6 million barrels. Gazprom estimates the field in Yalmal-Nenets district in Western Siberia contains 800 billion cubic meters of gas.

Wintershall, a wholly owned subsidiary of German company BASF AG (BAS.XE), has a 25% minus one share stake and a nonvoting preferred stake in Severneftgazprom. Another German company, E.ON AG, signed a preliminary deal to acquire 25% in the project and in return grant Gazprom stakes in E.ON assets in western and central Europe, but talks are yet to be completed.

Gazprom is planning to use gas from Yuzhno-Russkoye to fill the Nord Stream pipeline which will run under the Baltic Sea directly between Russia and Germany. The Nord Stream consortium, in which Gazprom has a controlling stake, also comprises state-controlled Dutch gas network operator NV Nederlandse Gasunie, E.ON and BASF.

LONDON, March 28, 2008 (Dow Jones Newswires)