New Gas Reserves Discovered in Karakalpakstan

Uzbekneftegaz has reported finding new industrial gas condensate reserves in the Nizhny Surgil area of ​​the Ustyurt plateau in Karakalpakstan. The company have detected the presence of significant volumes of gas and condensate at a depth of 3,600 meters and have assessed that they can be commercially exploited and will prepare proposals for further exploration at the Lower Surgil field.

 

The Ustyurt plateau is one of the most important sources for the growth of hydrocarbons in Central Asia. At the end of 2016 Gazprom and Uzbekneftegaz, established a Natural Gas Stream joint venture for gas production at the Jel field (GKM) on the Ustyurt plateau. The project is expected within the next 10 years to reach a production capacity of some 1.5 billion cubic meters of gas and 76,000 tons of condensate. The investment to develop the project being expected to be in the region of 700 million US dollars. In total, Uzbekneftegaz plans to increase its hydrocarbon production to 53.5 billion cubic metres of gas condensate and oil by 1.9 million tons 2017-2021. (In 2017 Uzbekistan produced 56.4 billion cubic meters of gas and 806 thousand tons of oil).

Source: https://www.rbasia.uz/single-post/2018/01/26/New-Gas-reserves-discovered-in-Uzbekistan

Case Study - Shakhpakhty Condensate Gas Field Karakalpakstan

Diagram: Hydrocarbon survey, exploration and production areas in Uzbekistan (Ustyurt region) Source: Gazprom website

Shakhpakhty Gas Field

Shakhpakhty is a gas condensate field located in Uzbekistan in the southeastern part of the Ustyurt Plateau within the Kungrad Region of the Republic of Karakalpakstan, and was discovered in 1962. Geological surveys carried out here before 1968 confirmed initial commercial gas reserves in the amount of 46.5 billion cubic metres.

Commercial production began at Shakhpakhty in 1974, comprising 2.5 billion cubic metres per year. In 1983, the Shakhpakhty booster compressor station began operation, but was stopped in February 2002 due to inadequate power for the required upstream gas supply pressure. At that time, the operating organisation decided to shut down production and the wells were preserved. During the initial production period, 36.5 billion cubic metres of gas were produced from the deposit, which was then approximately 78.5% of the initially confirmed reserves.

In early 2003 a feasibility study was prepared in for investment in the follow-up Shakhpakhty field development based on the production sharing agreement with subsequent construction of  a new UGS facility. The reconstruction and further development of Shakhpakhty was carried out under a Production Sharing Agreement signed in 2004 for a period of 15 years.

In May 2004 Gazprom zarubezhneftegaz and Gas Project Development Central Asia AG established Zarubezhneftegaz  – GPD Central Asia as the field operator to implement the PSA. Under the PSA terms and conditions the investor obtained licenses for the rights to use subsurface resources, to produce and sell gas.

In August 2004 the consortium commenced the operations on the re-entry of wells and natural gas production. The work included surface construction and development, production and distribution of raw materials and the construction of the corresponding infrastructures, gas purification and storage, performing environmental protection measures amongst other activities.

Concurrently with resuming natural gas production, the operator started upgrading of the Shakhpakhty gas field infrastructure to boost the capacity for gas collection, treatment and transmission from the field to the Shakhpakhty booster compressor station (BCS) and gas compressor station at Karakalpakia.The gas produced at Shakhpakhty after leaving the Karakalpakia compressor station to be sent through the Central Asia-Centre gas pipeline to consumers in the C.I.S and Europe

In 2006 the Shakhpakhty booster compressor station and preliminary gas treatment works and base camp were completed.  Between 2005 and 2008 several wells were overhauled with a view to expand the producing well stock and extend the well service life. In 2010 the operator received a license for developing three additional underlying productive formations.

Sources: http://www.gazprom.com/about/production/projects/deposits/uzbekistan/ and http://www.gazprom.com/about/production/projects/deposits/uzbekistan/

Oil and Gas Industry in Uzbekistan

The Oil and gas industry is one of the leading industries in Uzbekistan. About of 60 % of the country’s area has a potential for oil and gas exploitation. Currently there are some 211 hydrocarbon fields opened in the five oil and gas regions of Uzbekistan. Of which 108 – gas and gas condensate, 103 – oil and gas, oil-gas condensate and oil. Over 50 % of gas and oilfields are under development, 35 % are being prepared for the development, and on the others exploration is ongoing. Uzbekistan ranks the 8th place in the world’s leading producer of natural gas. Proved reserves of Natural Gas are 1.841 trillion cu.m. (1 January 2012 est.)

Note: proved reserves are those quantities of natural gas, which, by analysis of geological and engineering data, can be estimated with a high degree of confidence to be commercially recoverable from a given date forward, from known reservoirs and under current economic conditions.

ARAL SEA OPERATING COMPANY

The Aral Sea Operating Company was set up in 2006 to explore and develop Uzbekistan’s oil and gas fields in the Aral Sea on a Product Sharing Agreement basis.

The JV "Aral Sea Operating Company" LLC being established by Consortium of Investors in accordance with Decree of President of Republic of Uzbekistan "On the conduction of geological studies of Uzbekistan part of Aral Sea with further development of newly discovered deposits of hydrocarbons based on the terms of Production Sharing Agreement PSA)for the Uzbekistan part of Aral Sea between Republic of Uzbekistan and Consortium of Investors signed on 30.08.2006.

On the 21.02.2007 the JV "Aral Sea Operating Company" LLC was registered by the Ministry of Finance as a Legal entity. Initial investors in the PSA were the National Holding Company "Uzbekneftegaz"(Uzbekistan), "LUKOIL Overseas Aral Ltd." (Russia), KNOC Aral Ltd. (Korea) and CNPC Internation Ltd. (China) and Petronas Company of Malaysia (whose share now been sold to Lukoil O.A. Ltd)

The Eastern Ustyurt, located between the Emba, South Mangishlak, Bukhoro, Khiva oil and gas regions has long been considered (since Soviet times) as a highly promising area for oil and gas production.

The Ustyurt Plateau, including the Aral Sea, and adjacent Karakum and Kizilkum deserts, during the Jurassic period were a vast water body that stretched from the Caucasus in the west to the Tian Shan in the east. In this time hydrocarbons were layed down.

In recent years Uzbekistan has explored for oil and gas in the area; Geologicists and geophysicists who have undertaken geological mapping, seismic work and drilled a number of deep boreholes to confirm these deposits. Four promising fields in the Jurassic era deposits : West Aral, Umid, Aktepa and Shagala have been identified. Also since 2007, the waters of Aral Sea have been explored by 2D seismic surveys using modern geophysical equipment.

Nodir Mukhitdinov, deputy director of the Oil and Gas Geology and Exploration Institute "Currently, the geological study of the Uzbek part of Aral Sea area is conducted in accordance with the decree of the president of the Republic of Uzbekistan ‘On the geological study of the Uzbek part of Aral Sea and the subsequent development of newly discovered fields in terms of the Product Sharing Agreement’"

(As of Aug, 2013)

Uzbekistan has granted a consortium of investors from five major companies : Uzbekneftegaz (Uzbekistan) Petronas Carigali (Malaysia), CNPC (China), KNOS (Korea) and Lukoil (Russia) to undertake a geological study of the Uzbek part of Aral Sea and the subsequent development of newly discovered fields in terms of the Product Sharing Agreement.

The consortium have chosen the Western Aral as the most promising area to start. As a result of drilling and testing of the Jurassic deposits in this field they have found a commercial influx of gas and condensate, and have opened a new gas condensate field. This has proved high potential of the Uzbek part of Aral Sea area in the discovery of new reserves of hydrocarbons and confirmed the forecasts of Uzbek geologists.

In 2010 further exploration wells are being undertaken in the Shagala area. And currently investors are considering options of drilling new exploration wells in Aktepa and Umid, as well as accelerating the exploration for deposits in western Aral Sea with the options of natural gas production.

Some experts believe that if the project is implemented successfully, the Aral sector of Uzbekistan may become more attractive for investors than the Caspian oil and gas fields of Kazakhstan. Uzbekistan’s sector in the Aral Sea has been estimated to hold around 31 percent of the oil and 40 percent of the natural gas reserves of Central Asia, which potentially would make Uzbekistan the second largest oil producer in the region, rivaling Kazakhstan. Uzbekistan is steadily increasing its export volumes of gas. In 2010, the volume of gas exported from Uzbekistan to Russia exceeded that of Turkmenistan to Russia and equaled 15.5 billion cubic meters (bcm), compared to 10.5 bcm in the preceding year and by 2012 this should rise to 14.5 bcm of gas. Southern Kazakhstan is largely dependent on Turkmen and Uzbek gas supplies. Further Uzbekistan is soon scheduled to start gas exports to China through the gas pipeline from Turkmenistan to China, the 529-km Uzbek section of which is planned to be completed by 2014.

Source:http://www.linkedin.com/companies/aral-sea-operating-company-llc April 2010 and Uzbekistan Today (Edited) July 16, 2010 and www.infoshos.ru, November 11, 2009.