Registration document 2007 - Total.com

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Commonwealth of Independent States (CIS)
TOTAL’s production for 2006 was 8 kboe/d, accounting for
0.3% of the Group’s overall production. Production in 2004
and 2005 came entirely from Russia and amounted to
9 kboe/d for each year. Highlights for 2006 included the
start-up of the Shah Deniz project in Azerbaijan.
Azerbaijan
TOTAL’s presence in Azerbaijan dates back to 1996 and is
centered on the Shah Deniz field (10%). After phase 1 of
development of this gas and condensate field was launched in
2003, production from the first well began in December 2006.
The first gas sales to Azerbaijan were made late in 2006.
The South Caucasus Pipeline Company (SCPC), in which TOTAL
holds a 10% interest, completed the construction of a gas
pipeline to transport gas from Shah Deniz to the Turkish and
Georgian markets. This gas pipeline was gradually brought
onstream and became operational in November 2006.
Construction of the 1,770 km BTC (Baku-Tbilissi-Ceyhan) oil
pipeline, with an operating capacity of 1 Mb/d, began in August
2002 and was completed in 2006. This pipeline, owned by BTC
Co. (in which TOTAL has a 5% interest), links Baku to the
Mediterranean Sea. The first delivery to Ceyhan (Turkey) was
made in June 2006.
Kazakhstan
TOTAL has been present in Kazakhstan since 1992, where it is a
partner on the North Caspian Sea permit which contains the
Kashagan field. TOTAL holds an 18.52% interest in this permit
after closing the sale of 1.85% to KazMunayGas, the stateowned
company of the Republic of Kazakhstan, in April 2005.
The Kazakh authorities approved the development plan for this
field in February 2004, allowing work to be done on the first of
several successive phases of development. Infrastructure and
civil engineering work has accelerated and most of the major
contracts regarding the manufacture and construction of both
onshore and offshore facilities have been awarded. The facilities
are currently being evaluated to optimize their dependability while
improving safety. Drilling of development wells was launched in
2004 and continued in 2005 and 2006, with production now
scheduled to begin near the end of 2010. The size of the
Kashagan field may eventually allow production to be increased
to more than 1 Mb/d (in 100%).
The North Caspian permit includes other structures that are
smaller than Kashagan: Aktote, Kairan, Kalamkas and Kashagan
Southwest. These structures are in the appraisal phase. The first
appraisal well on the Aktote structure, drilled in 2004, confirmed
and helped to define this discovery. Appraisal operations
continued in 2005, with the completion of a 3D seismic
acquisition on the Aktote and Kairan zones as well as the drilling
of the Kalamkas 2 well. In 2006, two new appraisal wells were
drilled on Kalamkas and Kairan. The Kalamkas-3 well was
positive and the results for the Kairan 2 well are being evaluated.
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Business overview
Upstream - Exploration & Production
TOTAL – Registration Document 2006
A long-duration test is expected to start on Kairan 2 during the
first half 2007.
Russia
TOTAL has been present in Russia since 1989. The Group’s
principal activity is on the Kharyaga field (50%, operator) in the
Nenets territory. The Group’s production was 8 kboe/d in 2006,
compared to 9 kboe/d in 2005 and 2004.
On the Kharyaga field, phase 2 of development was completed
in 2005, targeting a production plateau of 30 kboe/d (in 100%).
Pre-project studies for phase 3 were carried out in 2006. Late in
2005, TOTAL and the Russian Federation reached an amicable
agreement to resolve a dispute over the interpretation of the
production sharing agreement. As a result, the request for
arbitration in Stockholm was withdrawn. In 2006, the production
sharing contract was implemented normally, with profit oil being
shared among the state and investors.
The preliminary technical results from the Russian Black Sea
partnership led the Group to withdraw from the Shatsky permit in
2004 and the Tuapse permit in 2005.
In 2004, the Group entered into negotiations to acquire 25% of
Novatek, the country’s second leading gas producer. The
transaction was not completed as the required approval from the
authorities was not obtained. In 2005, TOTAL was pre-selected
by Gazprom, along with four other foreign companies, to
potentially participate in the giant Shtokman gas production
project in the Barents Sea. In October 2006, Gazprom
announced that the project would not proceed under the
proposed contractual framework, since the Russian Federation
no longer wished to share acreage with independent oil
companies. Other contractual arrangements are being studied for
this project.