Verkhnechonsk

Verkhnechonskoe field is situated in northern Eastern Siberia, 1,100 km north of Irkutsk. Its name is derived from Chona River that stretches 800 km and flows into Vilyuiskoe Water Storage in Yakutia. The discovered hydrocarbon reserves in the field currently amount to 200 million tons. The construction of East Siberia — Pacific Ocean (ESPO) Oil Pipeline that was started in 2006 in the immediate vicinity of Verkhnechonskoe has turned this field into a uniquely convenient resource base of colossal scale.

TNK-BP inherited an interest in Verkhnechonskiy project as a co-owner of RUSIA Petroleum. After the oil and gas assets had been shared, Verkhnechonskneftegaz was founded as a corporate entity, and TNK-BP currently owns 68.5% of shares therein. Rosneft partners with TNK-BP in the project.

Verkhnechonskoe field is unique in terms of nature and structure. It was discovered as far back as 1978, and it is still believed to be the largest field in Eastern Siberia. However, there was no realistic engineering and economic concept for developing the field nor human and technical capability for implementing such a concept for a long time. The field oil-bearing rock was formed in the Pre-Cambrian Period, which resulted in its hardness and significant salt deposits that became a challenge for those who wished to develop the field. High technological capability and a combination of international experience with the Russian oil tradition allowed TNK-BP to make a thorough evaluation and start developing Verkhnechonskoe field.

A complex geological structure of oil-bearing formations has dictated the necessity to apply a special engineering solution for developing Verkhnechonskoe field. The solution is to drill high-angle and horizontal wells penetrating several layers of a pay reservoir.

Stage 1 (2003—2005) comprised extensive surveys including well interference tests in addition to drilling. The surveys have demonstrated that the geological structure of the field has two more horizons in addition to the known one. One of them contains oil, and the other one contains about 95 bcm of gas.

Pilot operation of the field was started in 2005- 2006, and the first ton of oil was produced in 2008. The same year saw completion of construction of an 85 km pipeline connecting Verkhnechonskoe field to ESPO, a motor road with seven permanent bridges, commissioning of oil treatment units and a power plant operating on associated gas.

The field was put in commercial operation in October 2008 and yielded 156 kt of oil by the end of the year.

TNK-BP plans to produce more than 1million tons in Verkhnechonskoe field in 2009 and expects the production to peak at 7 million tons in 2014.

The total volume of investment in Verkhnechonskiy project has already exceeded $1bn and may ultimately reach $4—5bn depending on the required number of wells.

Verkhnechonskoe field currently employs more than 2000 people including 1500 specialists from 45 contractor organizations from all over the country.