RusEnergy

MOSCOW, January 23 (RIA Novosti) - Russian oil company LUKoil's overseas subsidiary has started drilling a second exploration well at Egypt's offshore North-East Geisum block, the firm said Monday. The well is to be drilled to a depth of 1,574 meters, and the estimated cost of the six-week project is $6.1 million. LUKoil Overseas won an open tender, held by the Egyptian State Oil Company, for the North-East Geysum and West Geysum offshore blocks in January 2003 and signed agreements with the Egyptian oil ministry later that year in June. The Geisum blocks are thought to hold around 261 million barrels of oil. The four-year geologic exploration program envisages the drilling of four exploration wells in the second phase of development. Lukoil has initially budgeted $27.8 million for the exploration work. The first exploration well was drilled at North-East Geisum in late 2004 and proved the presence of hydrocarbons.