Shtokman to cost $800 million for 2008 through 2009 in make or break progect

Publish date: October 21, 2008

The Shtokman Development company board of directors revealed that its budget for work on developing the Barents Sea based Shtokman oil and gas condensate field is $800 million for 2008 and 2009.

The sum is sufficient for an entire evaluation of the project, including seismic work, test drilling, and interpretation of results, said analysts. They further added that the sum may also cover the cost of a drilling platform, the average cost of a floating drilling platform being $300 million.  

For the first stage of the project, no less than $10 million is required, according to analysis by ConocoPhillips. Investment in the project have reached $20 million, reported. Alexander Shtok, director of the independent consulting group Due Dilligence, said that in conditions of financial crisis it will be difficult for the Shtokman Development company to find capital, the Ros Business Consulting newswire reported.

However, developing the field is one of Russian state gas giant Gazprom’s most important tasks because many of the company’s other fields are depleted and failure to find new fields could break the company. There is therefore no doubt that the Gazprom monopoly will use every means at its disposal to succeed in the Shtokman field.