Oil and Gas

Four oil fields have been considered perspective, their potential is estimated at over 7.5 million tons. Moreover there are another 5 prospective structures and their potential is 27.9 million tons. All these objects on the condition of procession of oil extracted in the region and its delivery on the internal market are quite effective.
On the whole, the exploration of the discovered oil fields requires investment worth $416 million, and investment for exploration of oil resources in the prospects is estimated at $902 million. The total investment required for the search and exploration of new oil fields on land and underwater within 12 miles from the shore are estimated at $1.318 billion.

Gas

With the price for gas rising to $90/thousand cubic meters, the exploration of not only Zapadno-Ozernyi but also Verhne-Telekaiskiy fields as well as Yuzhno-Kulskaya, Uvalnaya and Ivanovskaya structures are considered to be economically expedient.
The need for investment for further exploration of gas fields is over $20 million, and $135 million for geological analysis of prospects. Total investment capacity of exploration of gas potential of the region is estimated to be $575 million, $94 million of which is necessary for the industrial facilities of the fields. If this price is taken into consideration, even another 5 profit-bringing objects with the total volume of gas resources of 10 billion mi can be included in the list.

Factors of Attractiveness

Investment attractiveness of the oil and gas branch of the CHAO is determined by:

High possibility of discovery of new large fields as a result of geological exploration;
Support of the administration of the Okrug of projects of decreasing the volume of imported hydrocarbon fuel by means of own refineries (mini refineries, light oil refinery installations);
Presence of already explored small fields ready for profitable exploration in Anadyr region able to meet the needs of the CHAO;
Potentially big volumes of resources on the shelf, which profitability rises in connection with intensive development of infrastructure in the region.

Table. Expected growth of resources and levels of oil and gas extraction in the territory of Chukotskiy AO (Anadyr NGB)

	Year
	2007-2010	2011-2015	2016-2020	2021-2025	2025-2030
growth of resources, million t/year	1	0,8	0,8	0,7	0,6	18,5 million tons
extraction, million t/year	0,2	0,5	0,5	0,5	0,4	10,3 million tons
growth of resources, bln м³/year	0,5	1,5	1,5	1,4	1,4	28 bln m³
growth of resources, bln м³/year	0,3	0,5	0,6	0,5	0,5	11,7 bln m³

Further exploration of open oil fields of Anadyr NGB – up to 5-7 million tons;
Organization of oil refining at mini modular refineries;
Active geological exploration for discovery of new hydrocarbon fields and semi-annual growth of oil resources by 0.6-0.8 million tons and gas by 1-1.5 billion mi.
Study of foulness of the territorial water of Chukotskiy AO and aiding exploration works in the defined water area.

A program of building a reliable transport infrastructure under way by the Government of CHAO will make investment perspectives better. The programme implies:

Development of an optimal system of marine shipping and port approach servicing of Chukotskiy Peninsula;
Provision of reliable navigation and hydrographic servicing of marine shipping routes along the coast of Chukotka;
Reconstruction of Beringov seaport and deepening the level of its seabed, which will make it possible to undertake handling from the mooring line.

Perspectives of development of the oil branch are connected with:

The presence of a large company having considerable sources of investment into geological exploration and extraction (Gaspromneft);
Gradual reduction of hydrocarbon resources in the regions of its traditional extraction, which makes the biggest Russian oil companies master shelf extraction technologies;
Expansion of geological exploration of oil and gas in the North regions of the world (hydrocarbons are used for the development of regional TEKs and for export).

World experience (Alaska, North Canada, Norway and others) shows that extreme weather conditions, absence of infrastructure and remoteness from the customer are not an absolute obstacle for exploration of oil and gas fields. High cost of boring and facilitating the fields, considerable expenses of building pipelines and transport communication get dealt with by big companies that have strong financial opportunities.

The most likely scenario of development of the branch in the territory of the Chukotskiy AO implies a considerable growth of extraction volumes by means of exploration of oil and gas shelf deposits.

Anadyr

4:43 -14°C

COMMENTS

The program of economic development in Chukotka can be carried out, considers vice-premier of government CHAO M. Sobolev.

First of all, the long-term program leans on resources of peninsula. Let’s begin that geological resources of Chukotka are explored today on 10 %-17 %. The next regions are explored much better. And even on these, tentative estimations resources here can be found. The proved resources of gas on the Priosernoe deposit - 7,3 billion cubic meters. Oil resources are estimated approximately in 10 million tons, the proved stocks make 4 million tons of them. They are dispersed on small Fields, such, as Hatirskoe, where extraction is conducted by "Sibneft" company. But it is not necessary to dismiss a shelf – it’s insufficiently studied yet, but there are data, that it’s resources can make up to 14 billion tons of conditional fuel. Exxon Mobile Company in similar ice conditions, in Baffin bay has constructed 7 platforms. What prevents to construct them here?
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Reindeer breeding can be profitable: E. Marochkin acting on the head of agriculture and foodstuffs department makes comments.

There was a moratorium on an industrial slaughter of deers in district till 2006. But now it is removed, farms have allocated a contingent for commodity slaughter this year. It is planned to hand over in a trading network about 9 thousand deers this year. Within the limits of national project the agrarian and industrial complex have got slaughter area on terms of financial leasing which is assembled in Kanchalan. Basically its value is in that correctly cut production will receive a trade look and will answer all established norms. The livestock of deers for September, 1st - from above 183 thousand. It’s below the level of 1990 (490 thousand heads), nevertheless, in Chukotka a livestock grows on faster rates, than on Yamal, and it’s our main competitor. Potential market - not only Vladivostok, but also Japan, Korea, China. Reindeer breeding is, at least, preservation of a traditional way of life of native people and food safety of region and when sales volumes become great enough, branch can turn in profitable.
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