Dragon Oil chairman Hussain M. Sultan said that the new well would allow the company to produce more than 15,000 bopd in 2003.

Dragon Oil was licensed for the development of Turkmenistan's Cheleken block for 25 years. Cheleken's reserves are estimated at 600 million barrels of oil and 2.3 trillion cubic feet of gas.

Dragon Oil is developing the Cheleken block under a product sharing agreement (PSA). The agreement is expected to bring Turkmenistan $US7 billion in revenues.

Turkmenistan's Caspian Sea shelf hydrocarbon reserves are estimated at 16.5 billion tonnes.