The gas contract could be part of a general cooperation agreement with CNPC expected to be signed during Russian President Dmitry Medvedev's visit to China September 26-28, the Lukoil spokesman said.
Lukoil is planning to export gas it produces in Uzbekistan via the Trans-Central Asia gas pipeline from Turkmenistan to China, the spokesman said.
"We have infrastructure ready there and now we want to guarantee that our gas will be sold," he added.
When asked about the details of the agreement, the Lukoil spokesman said they have yet to be specified but the company was inclined to conclude a long-term contract using a gas price formula linked to a basket of oil products.
"It's widely recognized to be more profitable," he said.
Lukoil now sells all gas it produces in Uzbekistan to Russian gas major Gazprom for onward export, a spokesman with Lukoil Overseas said Monday.
"Next year, however, Gazprom is expected to accept a limited amount of gas meaning it would have no objective reason to prevent Lukoil from negotiating the possibility of selling gas to other consumers," he added.
The Kandym-Khauzak-Shady-Kungrad contract area is being developed under a 35-year production-sharing agreement signed by Russia's Lukoil Overseas (90%) and Uzbekneftegaz (10%) in June 2004.
Khauzak and Shady, the only producing fields within the license area, are expected to yield around 3 Bcm in 2010, a spokesman with Lukoil Overseas said.
Kandym is expected to come on stream in the next two or three years, with output expected to peak at 8 Bcm in three to five years after the start of production, the Lukoil Overseas spokesman said.
He added that the initial development program for Kandym had been revised due to the prospective agreement with China, but provided no details. Lukoil is currently preparing the site for the start of production, he added.
Kungrad is at the geological exploration stage, a spokesman with Lukoil Overseas said.
Lukoil produced 2.4 Bcm of gas in Uzbekistan in 2009, the Lukoil spokesman said.
China Chemical Weekly: http://news.chemnet.com/en/detail-1411716.html
