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Sat 20 Oct 2012 10:08 AM

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Dubai oil firm eyes $1bn spend in Turkmenistan

Dragon Oil says it plans to achieve production growth rate of 10-15% this year

Dubai oil firm eyes $1bn spend in Turkmenistan
(Photo for illustrative purposes only)

Dubai-based Dragon Oil plans to invest up to $1bn in infrastructure in hydrocarbon-rich Turkmenistan until 2015, according to a senior company official.

Hussain Al Ansari, chief operating officer of the company controlled by Dubai's Emirates National Oil Company, said it had invested about $2.4bn in the country between 2000 and June 2012.

He said in comments published by Reuters that Dragon Oil plans to achieve a production growth rate of between 10 and 15 percent in 2012.

Dragon Oil remained on target to reach the 100,000 bpd level in 2015, the company said in a statement.

Dragon Oil's output had risen more than tenfold from a 7,000 bpd in 2000 to 71,751 bpd at the end of 2011, Al Ansari said.

Rising investment in Turkmenistan's oil-rich Caspian shelf indicates growing interest by foreign oil firms to develop deep-lying but promising riches in the sea, while the state has been reluctant to admit Western companies to its onshore resources.

Several international majors, including Total, Chevron, ConocoPhillips and ExxonMObil, are vying for some of the undeveloped offshore oil blocks

Official data put last year's investment in the Caspian Sea shelf at $2.1bn.

Turkmenistan, better known as Central Asia's largest natural gas producer and one of the world's largest holders of "the blue fuel", produces annually around 10 million tonnes of crude (about 200,000 barrels per day), with state oil concern Turkmenneft accounting for most of the oil output.

The Turkmen sector of the Caspian comprises 32 licence blocks. Two of them are being developed and another three are being explored.

The government estimates its Caspian oil reserves at 12 billion tonnes of crude and more than 6 trillion cubic metres of natural gas. However, the country's hydrocarbon riches in the sea lie at big depths and demand large-scale investment.