Achimgaz,a joint venture of Gazprom and Wintershall Holding AG, has brought into pilot production Block 1A of the Achimov deposits at the Urengoy oil, gas and condensate field in the Yamal-Nenets Autonomous District.

At present, a comprehensive gas treatment unit and three gas condensate wells securing 2.3 mln cu m of daily production are being operated at the Block. Before the end of 2008, the planned volume of production accounts for 531 mcm of gas and 188.7 thousand t of condensate.

“Today we witness a fundamentally new stage of Gazprom’s resource base and production potential development. For the first time in the Company’s history we, jointly with our German partners, started producing gas from the Achimov deposits – having much more complicated geological structure as compared to the conventional Cenomanian and Valanginian deposits.

Furthermore, it was while establishing Achimgaz when Gazprom first introduced a new concept of cooperation with foreign partners: a joint venture receives profit from the project implementation, at the same time the license for the field is owned by Gazprom. Gazprom applies this concept as a pattern in establishing relations with foreign companies. The result achieved by our joint venture today proves the adequacy of our choice and efficiency of such business model,” stated Alexey Miller, the Chairman of the Gazprom Management Committee.

“In 2003 the successful partnership of Gazprom and Wintershall in gas marketing transferred to the production area. Within Achimgaz our know-how and experience supplement each other and optimally fit for the development of the hardly accessible Achimov deposits in Western Siberia: Gazprom deals with hydrocarbon production in the Far North, while Wintershall has a long-term track record in developing complicated geological structures. Such ideal partnership is based on the principle of equal sharing of risks and profits.

Over than 17-year cooperation between BASF/Wintershall and Gazprom in the Achimgaz joint venture has embraced all stages of the value chain: from gas extraction from the well in Siberia, its transmission and distribution to operations within the joint venture on gas marketing and sales to end consumers in Europe,” said Dr. Hans-Ulrich Engel, the Chairman of the Wintershall Holding AG Supervisory Board.

Background:

Achimgaz was founded on a par by Gazprom and Wintershall Holding AG (a wholly-owned subsidiary of BASF SE) in July 2003 for the purpose of developing the first pilot block of the Achimov deposits of the Urengoy oil, gas and condensate field. At the same time, Gazprom dobycha Urengoy(Gazprom’s 100 per cent subsidiary) is the license holder for the Urengoy field.

Some 200 bcm of gas and 40 mln t of condensate are planned to be produced over the entire development period (43 years). The rated capacity is circa 7.5 bcm of gas and 2.8 mln t of condensate per  annum.

The joint venture is the project’s operator and the owner of the infrastructure being installed on the Block. All the rights for the output and its marketing belong to Gazprom. The profit will be distributed between the partners in accordance with their respective stakes in the project, i.e. 50 per cent each.

According to the results of exploration works, the productivity of the Achimov deposits is confirmed in a vast territory of the Nadym-Pur-Taz region. Major hydrocarbon recoverable reserves of the regional Achimov deposits are concentrated at the Urengoy oil, gas and condensate field.

Achimov deposits are located at the depth of 3600 – 3800 m and featured by much more complicated geological structure in comparison with Cenomanian and Valanginian deposits that are being currently developed.