Volga Gas's Chief Executive, Mikhail Ivanov, said that with the delineation of the sub-salt Yuzhny-Ershovskoye (Y-E) structure complete and the location for the first well identified, the company is now well-placed to commence drilling operations on this high potential structure.
Work on the equally important Yuzhny-Mokrousovskoye (Y-M) structure is progressing well.
Yuzhny-Mokrousovsky Structure - Schlumberger has completed processing of the Y-M structure and has started interpretation.
It is expected that interpretation will be completedduring Q3 2008.
Volga Gas is preparing well documentation and has entered in to detailed negotiations for the first well on Y-E now that parameters are known. The Company will provide an update once a contract has been entered in to.
Supra-Salt - Interpretation and processing of 3-D seismic data has been completed over 2 of the 5 structures in the southern block of the KLA.
The company has entered in to a 9 well contract, at least 4 of which are expected to be completed during 2008.
Vostochny-Makarovskoye - On May 29, Volga Gas spudded well VM#2 at the northern end of the Vostochny-Makarovskoye licence area.
The well is being drilled as a production well and is expected to be completed in early Q4.
The company has contracted the BK Eurasia rig for a further well with an option for two more.
Well VM1 has been cased and is currently being hooked up to the gas processing plant.
Initial cased hole testing has yielded commercial rates of gas and condensate and the wellwill be put on long term production testing in June.
Installation of the gas processing plant has commenced and is running to plan.
It anticipates the plant to be capable of selling pipeline standard gas by year end.
The Vostochny-Makarovskoye development schedule is on track to produce first revenue before year-end. Well VM2 is essential to enhance its understanding of the Evlano-Livenskiy reservoir, said the Chief Executive.
Following the completion of VM2, it will incorporate the data in to the reservoir model and will subsequently publish updated reserve calculations during Q4, he said.