Authorities in Uzbekistan have agreed to grant Canadian minnow Condor Energies operatorship of several natural gas and condensate fields in the mature hydrocarbon province of Bukhara.

The eight producing fields previously operated by state-run gas producer Uzbekneftegaz have been the subject of negotiations that lasted throughout the whole of the last year.

Condor said in a statement that the contract calls for the company to increase the production and overall recovery rates from an integrated cluster of eight conventional fields in the southwest of the country close to the Uzbek-Turkmen border, where Uzbekneftegaz has been producing condensate and natural gas.

Under the contract, Condor will sell the produced gas to state-run Uztransgaz, which is responsible for the purchase and sale of natural gas for use in the domestic market.

Condor will be responsible for all costs of the field rehabilitation project, and will receive a percentage of net revenues realised from the project in compensation, the company said.

The Toronto-listed minnow is the first western player allowed to operate in Uzbeki oilfields since the 2019 arrival of privately held US investor Epsilon Development, which was granted licences to operate several blocks and rehabilitation projects in the country.

Condor said it hopes to assume control of operations at the assets in March, noting that equipment is being mobilised to development sites and environmental and technical studies are under way.

The country has partially opened doors to western oil and gas investors since 2016, following the death of long-time leader Islam Karimov.

The country had traditionally leaned towards oil and gas players from the former Soviet Union, with Russia’s Lukoil, Gazprom and Tatneft — and most recently, Azerbaijan’s Socar — given priority rights to Uzbek oil and gas reserves.

The fields in the Condor contract area consist of stacked carbonate and clastic reservoirs that are geologically similar to those in the Western Canadian Sedimentary Basin, Condor said.

The eight conventional fields “are experiencing high annual decline rates and low recovery factors which the company intends to mitigate while also reducing carbon emissions by introducing proven modern technologies and operating techniques”, Condor added.

Production increases are planned by implementing “artificial lift, workover and infill drilling programmes and also investigating deeper horizons in the assigned fields that are productive in other regions of the country”, the company said.

Seismic reprocessing and a 3D seismic programme are also planned.

Condor expects to commence operations in the first quarter of 2024 after an environmental baseline audit and technical inspections are completed.

“We are very excited about this investment opportunity and are honoured to be selected as Uzbekneftegaz’ first Western strategic operating partner to contribute to increasing Uzbekistan’s natural gas production rates and recoverable reserves”, Condor chief executive officer Don Streu said.

Earlier in January, Condor announced an agreement with the government of neighbouring Kazakhstan to secure the supply of feed gas for its planned modular liquefied natural gas production facility in the country.

The feed gas will be liquefied to produce up to 350 tonnes per day of LNG to replace diesel fuel, reducing carbon dioxide and other greenhouse gas emissions, Condor said.

The company is implementing an LNG liquefaction technology that was originally developed by the US Department of Energy.

Condor said the modular technology will allow it to “right-size” LNG production facilities to match production with local demand.