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Eurasia to acquire the development and exploration drilling assets of Slavneft

Eurasia Drilling Company Limited is to purchase the development and exploration drilling assets of OAO NGK Slavneft (Slavneft) for a total consideration of US$150 million. The transaction is expected to close by mid 2011. Under the terms of the agreement, Eurasia Drilling will acquire Slavneft’s businesses operating in Western and Eastern Siberia.

They include Megionskoye Upravlenie Burovykh Rabot LLC, Ob geologia LLC, Megion geologia LLC and Baykitskaya Neftegazorazvedochnaya Ekspeditsia LLC.
In addition, Slavneft and Eurasia Drilling have agreed to develop a Framework Agreement for the provision of drilling services by Eurasia Drilling to Slavneft following the acquisition. The Framework Agreement is expected to cover a five year term commencing at the completion of the transaction and includes pricing terms, annual price adjustment provisions and commitments for drilling volumes. 

Alexander Djaparidze, Chief Executive Officer of EDC, said the transaction is in line with the firm’s strategy of complementing its organic growth with the acquisition of high quality operations. This new partnership with Slavneft is another important step in expanding Eurasia Drilling’s customer base, said Djaparidze.      

Eurasia Drilling is the largest independent provider of onshore drilling services in Russia, as measured by the number of meters drilled, providing onshore integrated well construction services and workover services. In addition, the Company provides offshore drilling services in the Caspian Sea.

The Company offers its onshore integrated well construction services and workover services to local and international oil and gas companies primarily in Russia and its offshore drilling services to Russian and international oil and gas companies in the Russian, Kazakh and Turkmen sectors of the Caspian Sea. The Company is traded on the London Stock Exchange. 

The firm offers onshore integrated well construction services and workover services to local and international oil and gas companies primarily in Russia and its offshore drilling services to Russian and international oil and gas companies in the Russian, Kazakh and Turkmen sectors of the Caspian Sea.

OAO Slavneft is one of the largest exploration companies in Russia. The region where the firm conducts its activities covers the territory of West and East Siberia of the total area of about 200 square km. The subsidiary performs the full scope of works in exploration and development of oil and gas fields and carries out the test and pilot commercial operation of wells.

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