Dragon ups Cheleken area spending

Dragon Oil has budgeted up to $300 million for its 2009 capital expenditure program in the Turkmen sector of the Caspian Sea.

Offshore staff

ASHKABAD, Turkmenistan --Dragon Oil has budgeted up to $300 million for its 2009 capital expenditure program in the Turkmen sector of the Caspian Sea. This is slightly up on last year's capex of $287 million, of which 60% was allocated to drilling, with the remainder committed to infrastructure development.

The company operates fields in the Cheleken Contract Area (CCA). New projects under way include refurbishment of the Dzheitune (Lam) 28 platform; construction of the new Dzheitune (Lam) B platform; additional tanks for the Central Processing Facility; and installation of a new 30-in. (76-cm), 40-km (25-mi) trunkline to export all oil and gas to the mainland.

Milestones completed this year include refurbishment and upgrading of the Dzheitune (Lam) 13 platform and refurbishment of theRig 40.

During 2009-11, Dragon plans to increase production from the CCA fields by up to 15%, with eight new wells completed this year, and up to 35 development wells over the period 2009-11. It estimates total spending on infrastructure during this period of $700-800 million, subject to approvals under the production sharing arrangement and the availability of rigs and other services in the Caspian Sea region.

It also foresees an outlay of $200-250 million for its onshore gas treatment plant.

Earlier this year, Dragon reported a revised reserves certification for the CCA of 645 MMbbl of oil and condensate and 3.2 tcf of gas.

03/27/2009

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