ASNG’s objective is to complete the exploration of the three license blocks in succession, within the next two to five years and subsequently start the development and production phase.

Since exploration work in the Arctic conditions needs to be carried within a constrained ice-free window, ASNG’s strategy is to obtain data, required for field development, using the most efficient, state of the art exploration technologies available.

To optimize the cost of investment in the development and production phase and reach optimal field oil production levels, ASNG plans

• to implement horizontal drilling technology
• to use well stimulation and artificial lifting to accelerate production

Since the license blocks are located in the zone of annual ice the produced oil shall be transported by the ice class tankers with the support of ice-breakers to the nearest ice-free transloading facility.

In view of the current oil market conditions and near future perspectives ASNG plans to export its entire production.

Tax considerations:

As one of the Russian government’s energy policy targets is the development of oil and gas reserves of the continental shelf (70% of which are in the western Russian Arctic), ASNG is realistically expecting and actively lobbying with the government for attaining a PSA (Production Sharing Agreement) status, which would significantly improve the project’s tax burden.