OMV Buys 10% Stake In Two Large Iraqi Gas Field Projects
May 17 2009 - 5:48AM
Dow Jones News
Austrian oil and gas company OMV AG (OMV.VI) said Sunday it has
acquired a 10% stake in Pearl Petroleum Company Ltd., the owner of
two large gas field development projects in Kurdish Iraq.
With the acquisition, OMV buys into the appraisal, development
and production operations of the two multi-trillion cubic feet gas
fields, Khor Mor and Chemchemal, which are based in the Kurdish
part of Iraq.
"OMV now has the rare opportunity to participate in the
appraisal, development and production of very large gas reserves
close to the European market," Helmut Langanger, the head of OMV's
production and exploration division, said in a statement.
OMV paid an initial sum of $350 million for the stake, but
contingent payments may be made depending on further reserve
determinations, the company said.
The Khor Mor field is already in production, and appraisal work
is due to begin at the Chemchemal field during 2009.
Based on current assessments, production at the two gas fields
could reach 3 billion cubic feet a day, corresponding to 500,000
barrels of oil equivalent a day, by 2015, OMV said.
It added that this production volume will leave "substantial
quantities available for export to destinations primarily in Turkey
and Europe via the planned Nabucco Pipeline."
The Nabucco Pipeline is a 3,300 kilometers long planned gas
pipeline which is to connect Europe with the Caspian region by
2013. The European Union-backed project will bypass Russia and
thereby reduce western Europe's dependence on gas from its eastern
neighbor.
The pipeline will be build by six oil and gas companies,
including OMV and Hungary's MOL Nyrt. (MOL.BU).
OMV said Friday that MOL has also acquired a stake in Pearl
Petroleum, but didn't give any details of this deal.
The sellers of the stakes are the previous 50-50 joint venture
partners Crescent Petroleum Co. International and Dana Gas PJSC,
OMV said.
-By Flemming E. Hansen, Dow Jones Newswires; +43 1 513 69 22 10;
flemming.hansen@dowjones.com