Eni signs extension to onshore Nebit Dag area PSA in Turkmenistan

Eni has signed an extension to the production sharing agreement (PSA) regarding the onshore Nebit Dag Area situated in West Turkmenistan.

It extends the duration of the PSA to February 2032 and a 10% stake out of the contractor share will be transferred by the operator of the block, Eni, to Turkmenneft.

Italy-based Eni will keep the remaining 90% interest in the PSA.

The deal will allow additional exploration and production investments in Burun and other satellite fields of the Nebit Dag block.

Eni has also signed a separate agreement with the Turkmen state agency for the management and use of hydrocarbon resources to explore the possibility of extending its activities to Turkmenistan’s offshore sector of the Caspian Sea.

The company said both the agreements expand its presence in Turkmenistan, where it started operations in 2008.

Turkmenistan holds the world’s fourth largest natural gas reserves. The country produced 2.274Tcf of natural gas in 2012.

The country’s proven natural gas reserves as of December 2012 stood at 353.1Tcf. Turkmenistan, however, faces challenges in developing its gas reserves due to far-off end-use markets and a lack of adequate pipeline infrastructure and foreign investment.

Majority of Turkmenistan’s proven gas reserves are located in the Amu Darya basin in the south-east and in the Murgab South Caspian basins in the western part of the country.