July 23, 2008

Lukoil, PDVSA Sign Joint Study Agreement for Junin-3 Block

Russian oil company Lukoil and Venezuelan state-owned energy major PDVSA have signed a joint study agreement for the Junin-3 block in the Orinoco heavy oil belt in the Guarico state of Venezuela.

Pursuant to the agreement, a joint study will be performed to evaluate the project pertaining to production of extra heavy oil, its further refining on the territory of Venezuela and subsequent exports.

Expenses for the study will be shared by the parties on an equal basis. The agreement will be effective for two years with a possibility of extension.

The previous agreement on Junin-3 was signed by Lukoil and PDVSA in October 2005 for a three-year term. Obligations under this agreement, related to quantitative assessment and certification of heavy oil reserves in the area of 678sqkm, have been fully discharged.

The results of these studies were certified by Ryder Scott, an independent engineering company, and officially approved by the Venezuelan ministry of energy and petroleum.