Polar lights Starts Production In Northern Timan-Pechora Hydrocarbon Province

Polar Lights Company, a joint venture between Conoco and Arkhangelskgeoldobycha and Rosneft, has started production from the Oshkotyn oil field in the Northern Timan-Pechora hydrocarbon province, about eight miles northeast of the Ardalin field.

Commissioning testing of Oshkotyn began on June 15, 2002, from the Oshkotyn 20 well, and two additional wells have since come on line.

Initial rates from Oshkotyn 20 were about 3,000 barrels of oil per day (BOPD) gross. Total production from the field, which is tied to the main Ardalin field process facility, is expected to peak at approximately 6,000 BOPD gross. Total daily production from the Ardalin field is currently 23,000 BOPD.

"By expanding our existing Polar Lights project, Conoco has demonstrated once again its commitment to Russia and its ability to enhance a successful business," said Eric Bell, president of Conoco International Petroleum Company.

"Development of the Ardalin satellite oil fields that utilize existing infrastructure has allowed us to enhance value for all stakeholders while minimizing our footprint in this delicate area," Bell continued. Construction of the Oshkotyn satellite field pipeline and facility was completed during the 2001-2002 winter season to protect the tundra environment some 1,000 miles northeast of Moscow.

"We're very proud that the project was not only completed on schedule and within budget, but showed excellent safety results and exceptional care for the fragile tundra environment," said Randy Whitt, general director of Polar Lights Company.

"It also is notable that the Oshkotyn wells were drilled in previous winter seasons utilizing ice pad technology and resulted in the company being awarded the prestigious Lomonosov award for environmental preservation. Preservation of the environment is a core value, engrained in the fundamental operating philosophy of the company," Whitt concluded.

Polar Lights Company operates the Ardalin field, which began production in August 1994 and since then has produced more than 80 million barrels of oil. The company is investing an additional $100 million to develop adjoining fields: Oshkotyn, Dyusushevskoye and Vostochno-Kolvinskoye.

Conoco holds a 50 percent interest in Polar Lights Company; Arkhangelskgeoldobycha holds 30 percent and Rosneft holds 20 percent.

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