TNK-BP signs Joint Study Agreement with PDVSA

TNK-BP announced that today Rafael D. Ramirez Carreno, Minister for Energy and Oil of the Republic of Venezuela and President of the state oil company PDVSA, and German Khan, Executive Director, TNK-BP, signed a Joint Study Agreement for Ayacucho-2 block of the Ayacucho area in the Orinoco Oil Belt.

The agreement was signed within the framework of the state visit of Venezuelan President Hugo Chavez to Moscow for talks with President Dmitri Medvedev on economic cooperation between the two countries.

The Joint Study Agreement was signed in the presence of President Medvedev and President Chavez.

Under the Agreement, TNK-BP and PDVSA are going to prepare technical and commercial proposals for a prospective joint project which will provide for production of extra heavy crude, improvement of the crude quality and export sales of the improved crude at a commercial value.

TNK-BP and PDVSA will set up a Steering Committee to manage activities of a joint Working Group.

The Working Group will carry out the research and design activity necessary for the project evaluation and optimal ways of its implementation.

The Joint Study Agreement is a logical continuation of the Memorandum on assessment and certification of reserves at the Ayacucho-2 block signed by the two companies in October 2007.

According to the MOU, TNK-BP undertook obligations to assist PDVSA in reserve assessment and certification of the Ayacucho-2 block. Since January 2008, a group of TNK-BP technical and commercial experts has been stationed in Venezuela to work on the project together with PDVSA. Joint activities have included examination of the reserve data available and getting new data through drilling and testing of new appraisal wells.

"We are pleased that our cooperation with PDVSA is progressing at a steady pace," said German Khan, "Venezuela is an important element of a global oil supply and demand equation. We hope there will be viable opportunities for TNK-BP to contribute to development of Venezuela's oil riches to the benefit of all stakeholders."