The British Nostrum Oil & Gas Increased Oil and Gas Reserves in Kazakhstan by More than 5 Times
Xodus Group Limited has prepared a report that contains an independent assessment of the reserves and resources of the Stepnoy Leopard group of fields in Kazakhstan as of 1 January 2024.
This was reported by Nostrum Oil & Gas PLC.
In August 2023, Nostrum announced the launch of exploration and appraisal work at the Stepnoy Leopard group of fields.
The corresponding program, worth US$6 million, was approved by the Board of Directors in July 2023. It was expected that its implementation will allow reclassification of part of the contingent resources to proved reserves and identify commercial development options for the fields.
The planned scope of work included:
- recommissioning of 2 wells at the Teplovskoye field;
- sampling and conducting extended production testing at both wells.
Drilling was scheduled to commence in mid-September 2023.
Appraisal work was expected to be completed in April 2024.
Nostrum Oil & Gas PLC CEO A. Khan’s key takeaway:
- The report confirms the commercial viability and potential for a full-scale Stepnoy Leopard development;
- In particular, by developing processing capacity and export infrastructure at the Chinarevskoye field, we are achieving maximum capital efficiency, which will improve the economics of the Stepnoy Leopard project and increase the scale of our operations;
- in addition to the existing processing of hydrocarbons supplied by Ural Oil & Gas from the Rozhkovskoye field, the inclusion of feedstock from the Stepnoy Leopard fields in the processing of feedstock will further increase the efficiency of our world-class gas processing capacity with a capacity of 4.2 billion m3/year and, as a result, the volume of cash flows (the NPV of the project over a 10-year horizon attributable to Nostrum is estimated at approximately US$220 million).
The report shows that:
- the integrated development plan for the Stepnoy Leopard fields is in line with Nostrum’s final investment decision;
- the estimated total proven and probable (2P) reserves of the fields (including around 25% liquids) are 138 million boe, which increases Nostrum’s resource base by more than 5 times – from 23 million boe to 133 million boe (attributable to the company);
- this, in turn, significantly increases the value of Nostrum NPV 10 (Net Present Value, ed.) by about US$220 million after taxes (taking into account 80% participation) with an IRR of 34% (Internal Rate Of Return, ed.);
- in addition, the prospective development of large discovered and proven undeveloped contingent resources (2C) of the Stepnoy Leopard fields in the total volume of 67 million boe has significant commercial potential;
- further exploration of deeper subsurface areas is planned to identify promising resources.
Nostrum Oil & Gas PLC. completed the acquisition of an 80% stake in Pozitiv Invest, which holds licenses for the right to use subsoil areas of the Stepnoy Leopard group of fields in July 2023.
The transaction amount was USD 20 million, less a small amount of debt to Nostrum Oil & Gas Coöperatief U.A.
The subsoil use contract is valid until December 2044.
Stepnoy Leopard group of fields
Stepnoy Leopard consists of 2 license blocks:
- Kamensko-Teplovsko-Tokarevskoye, where hydrocarbon deposits have already been discovered,
- the promising Kamenskoye block.
8 hydrocarbon fields have been discovered on the territory of the Kamensko-Teplovsko-Tokarevsky block – 4 of them are gas condensate, another 4 are gas condensate with oil rims: Tokarevskoye, Kamenskoye, Tsyganovskoye, Ulyanovskoye, Gremyachinskoye, Vostochno-Gremyachinskoye, Zapadno-Teplovskoye, Teplovskoye.
The fields belong to the Teplovskaya oil and gas accumulation zone.
The fields are confined to the upper part of the chain of organogenic reef structures of the Moscow-Artinsk marginal ledge.
In administrative and territorial terms, the fields are located:
- within the Zelenovsky and Taskalinsky districts of the West Kazakhstan region, 30-90 km north and northwest of the city of Uralsk, stretching as a chain of structures in the west-east direction;
- approximately 60-120 km west of the Chinarevskoye field and 10 km from the company’s loading terminal for transporting oil and gas condensate in the village of Beles.
