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According to the official information, potential oil and gas resources in the Republic of Dagestan are big enough: condensate oil – 509,3 Mln MT (incl. onshore - 169,3 Mln MT); natural gas – 877,2 billion cubic meters (incl. onshore - 337,2 billion cubic meters).

In the first half of 2013 in Dagestan oil and gas extraction was decreased, as the Industry and Energy Ministry of Dagestan reported.

"Compared to the last year oil extraction was declined by 11,8% - down to 84,7 thousand tones, gas extraction- by 2,8% - down to 155,3 Mln cubic meters. The main problem to that is a high rate of depletion and water cut of the both operated and new wells, due to the ignored   geological exploration works” – as the Ministry stated.  

As of 1 January 2008 industrial resources of Rosneft – Dagestan OJSC were 4,152 mln mt of the oil (condensate) and 2,179 billion cubic meters of the gas.

As of 1 January 2009 (under SPE-PRMS, DeGolyer & MacNaughton classifications) resources of Rosneft - Dagestan OJSC and Dagneftegas had the following structure: proved oil recourse - 8 mln bbl (1,09 mln mt), probable resources - 13 mln bbl (1,77 mln mt), possible resources - 9 mln bbl (1,23 mln mt.), totally 4,09 mln mt.

The indicators difference is determined by the significant distinction between the Russian inventory valuation system and  the SPE-PRMS / SEC standards.

Under the SPE-PRMS classification resources are divided in the next categories - «proved», «probable» and «possible» depending on the chances rate for its extraction. Proved resources have 90% of the chance rate, the probable ones – 50%, and possible resources – 10%.

In 1940 in the USSR volume of the oil extraction was 31,1 mln Mt (incl. in Azerbaijan - 22,2 mln mt, in the Russian Soviet Federated Socialistic Republic - 7 mln mt).

In 1940 in Dagestan it was extracted 0,145 mln mt of the oil (0,47% of the total extraction in the USSR or 2% in the RSFSR).

The planned figures of the Dagestan trust were 0,15 mln mt (Grozny specialists planned 2,77 mln mt). In 1942 “Makhachkala” and “Tarnair” deposits were discovered which increased the oil extraction. Within 1943 the oil extraction in Dagestan rose in 3 times, and by 1945 the volume of the oil extraction got 0,29 mln mt (1,49% of the total oil extraction in the USSR or 5 % in the RSFSR).

By the end of WW II the oil extraction were decreased either in Dagestan or in the whole country from 33 mln mt in 1941 down to 19,4 mln mt in 1945 (incl. 11,5 mln mt. extracted in Azerbaijan and 5,7 mln mt – in the RSFSR). During WW II the oil was extracting in a coyoting way that was destroying richest oil layers. The oil was extracted, driven through pipeline to the oil refinery plants, where they took light fractions - gasoline, and the leftovers were sent back into the layer from which it had been extracted earlier. Afterwards the degassed and oxidized oil made the further filed exploration impossible. In the beginning of WW II more than 60% of Azerbaijan oil were extracted in the flush way, but by the end of the war flushed gave less than 5% of the extraction, the rest was taken out with pumps and in the gas-lift way.

Dagestan oil is notable for its top quality which is determined by its low sulphur content (down to 0,1 %), high content (up to 90%) of the  low-boiling fractions (down to 350oC), which provides a possibility to get top quality gasoline, kerosene and diesel through simple oil refining. In 1945 a part of Dagestan oil in the total oil volume extracted in the RSFSR was 5%. This is a significant figure enough to take the Republic as an oil-producing region. But due to the adding new deposits into operation in Privolzhskiy and West Siberian regions, the importance of the Dagestan oil got de emphasis.  

 The Dagestan oil extraction industry reached its maximum performance (2,2 mln mt) in 1970, what was  0,62 % of the total oil extraction in the USSR or  0,77% -in the RSFSR). I.e., even on its peak of the oil extraction Dagestan was not an important player in this sphere.

 Since that times the oil extraction in Dagestan is steadily getting down: in 1990 – 636,1 thousand MT, in 2000 – 326,3 thousand MT, in 2008 – 220 thousand MT, in 2012 – less than 200 thousand MT.

 National register of the mineral reserves in Dagestan contains 53 onshore raw hydrocarbon (RH) deposits, including oil and condensate reserves – 14,8 mln mt, gas reserves - 112,3 billion cubic meters, which form  a mineral resources base (MRB).

Within last 20 years the MRB of the raw hydrocarbons has not been developing. Implemented geological exploration did not lead it to the significant reproduction or to the reclamation extension by means of undiscovered potential resources.

It is known that the condensate oil and gas extraction in Dagestan reached its peak of extracting in  1970 ( 2,2 mln Mt of the oil and 1,6 mln Cubic meters of the gas (see slide and diagram).

After that the extraction has been decreasing until discovering oil- and gas- deposits in Tersko-Kumskiy region in 1974.

In 1978-1992 it stabilized and holds on the level of  600-500 thousand mt of condensate oil and  1 Mln cubic meters of gas annually.

In 1993-2005 the volume of condensate oil extraction declined down to 350-300 thousand mt and of gas extraction down to 800-600 Mln cubic meters.

In 2006-2008 extraction reduction tendency remained (331-220 thousand mt of the condensate oil and  613-298 Mln cubic meters of the gas).

In 2009 the condensate oil- and the gas- extraction were 195,5 thousand mt and 316,0 Mln cubic meters respectively.

Consequently, the oil- and gas- extraction keeps reducing.




Negative tendencies in the oil- and gas industries in Dagestan have kept going on since 1970.

Raw hydrocarbons production has been reduced due to the following causes:

1. Some large and capacious deposits were exhausted until the 70s.

2. Newly running deposits were small and low-capacious.

3. Limitation in 1993 and further cessation of the oil acceptance by Chechenian oil refinery plants caused oil extraction shutdown.

4. Absence of the mineral resources base reproduction due to the small capacity, and lack of geological exploration.

5. Functional depreciation and obsolescence of the equipment.

Reduction of the geological exploration works was caused by:

1. Cancellation of the MRB reproduction trust fund.

2. Underfinancing of geological exploration, particularly drilling works at the expense of the license holders and  the federal budgeting; permanent lack of means in the federal budget.



There is enough potential to improve and stabilize the situation in the oil- and gas- industries in the Republic. With the appropriate financing and proper geological exploration works (GEW) at the sights of the distributed mineral reserve fund, chances to stabilize condensate oil exploration within capacity of 300 thousand mt and gas – 600 mln cubic meters annually are obvious:

1. There are three oil- and gas bearing onshore areas in Dagestan: Tersko-Kumskiy, Predgorniy, and Tersko-Sulakhskiy.

2. In part of the Russian sector of the water area of the Caspian Sea adjacent to Dagestan east terminations of known geological and structural elements of a land, perspective on oil and gas are traced.

3. The size of areas perspective on oil and gas is more than 28K kм2 onshore and 9K kм2 of the water are of the Caspian sea within 12 mile zone.

4. In the strategy reserve oil- and gas- content identified down to 4000-5600 м  in 5 deposits.

5. In the Republic more than 2700 wells of various depths were drilled for oil- and gas exploration. In 2003-2005 their conditions were inventoried and determined that most wells of the distributed mineral reserves are in an unsatisfactory technical condition. It is necessary to repair them systematically.

6. Initial summarized resources are estimated at up to 1,5 mln mt of the reference fuel.

All of these aspects points to favorable prospects of the condensate oil- and gas exploration stabilization.


 GEW programs aim to provide regulate all types of works on Russian RMB reproduction and protection. They also define scales and terms of the works implementation considering the country’s social and economic development forecasts. In the course of its realization and to carry on its clause 2.13  «Complex of the coordinated measures directed on settlement of a political situation and improvement of socio-political situation in the Republic of Dagestan», at Dagestan territory GEW on oil- and gas exploration are carried on systematically. The below table indicates figures and sources of the works financing:




Finance sources


















Federal budget








Republic budget








Equity and attracted capital








Incl. Gasprom-t-M LTD.

















Periodical GEW implementation increases the oil- and gas- content awareness; promotes extension of raw hydrocarbons usage and induces MRB development. All of these factors favor significant improvements in the Dagestan subsurface management.





1. Increase in financing of the exploration works which are carried out at the expenses both of license holders and the federal budget for the reproduction of oil and gas reserves.

 2. Exploration, prospecting works and estimation of the hydrocarbon deposits:

-   in Triassic and lower Cretaceous -Jurassic deposits of Flat Dagestan;

-        in upper and lower Cretaceous -Jurassic deposits of Foothill Dagestan.

3. Carrying out geological and search works for the purpose of preparation of potentially oil-and-gas structures for the drilling exploration:

-        within the Russian sector of a shelf of the Caspian Sea adjacent to Dagestan;

-        on Tersko-Sulaksky and Foothill Dagestan oil-and-gas areas.

4. Carrying out thematic and research works for the purpose of preparation of new raw hydrocarbons bearing sites for licensing.

5. Drilling of parametrical and search-estimated wells for further studying of a geological structure of oil-and-gas areas, the complex geologic-geophysical solutions of regional tasks and revaluation of expected resources of hydrocarbons on the basis of new data, and also ensuring high efficiency of detailed geological and search works.

6. Specification of a quantitative, geological, and economic assessment of resources of oil, gas and gas condensate taking into account the new geological results received within recent years, and also the established obvious discrepancy with earlier approved resources in subsoil.

7. Involvement in repeated development of earlier developed fields by restoration of the liquidated wells. On subsoil sites repeatedly involved in development, first of all, it is necessary to give an assessment of reserves (their quality and quantity), and also to carry out a new mapping of oil-and-gas deposits. For this purpose carrying out modern types of investigation that will allow to increase productivity of prospecting works as a whole is necessary.

8. Stabilization of optimum volumes of condensate oil and gas production.


of a new oil-producing enterprise in the Republic of Dagestan

 Aiming to increase oil-producing in Dagestan, there is a necessity to set up a company (in the future, government-private partnership), which will have two main divisions: one division will work on oil-producing stimulation applying advanced technologies on the oil-bearing sits, where oil extraction   was ceased 30-40 years ago; the other division will carry on geological exploration using the high-end exploration technologies to search and further operate new sits. 

As it is stated in the Preamble, on the territory of the Republic there are many deposits which were operated in the 50-70s of last century, and afterwards were preserved due to the water intrusions and wells rate decline down to 3-5 mt per 24h. Nowadays these deposits are privately owned, but only few of them are in operation.

We have offered our electromagnetic prospecting services to some license holders, but it turned out that they have not been able to finance such works even to learn if there are hydrocarbons on the their sites.

Therefore, the oil business situation in Dagestan looks like following: there are oil resources potentially contained up to some million mt per each; there are oil-bearing site owners, who don’t have enough funds to set up the operation of their sites; there are exploration services providers (like our company), who are ready to explore the sites and arrange technological process  of hydrocarbons extraction.

License holders are ready to sell their stakes in the companies (from 30% to 100%) at the adequate amounts (from 10 to 50 mln rubles); our company is ready to carry on all required prospecting works of the sites (services cost varies from 1 to 3 mln rubles), and then under results of prospecting works it will be possible to begin repairing the wells (3-5 mln rubles), which in whole will enable to start oil extraction in the volumes of 3 -20 mt/24h from each well.                                

When prospecting works and a few wells repair are done, it will be necessary to initiate oil-producing intensification. Advanced technologies enable to increase oil extraction from 3-20 mt up to  20-200 mt per 24h.

Here is a calculation of the efficiency of the funds, which are invested in oil extraction without advanced technologies appliance on the abandoned oil fields:


Costs for oil fields purchasing (10 wells)                                           10-50 mln rub

Costs for electromagnetic prospecting                                                           1 mln rub

Wells repairing costs (per each)                                                         4-5 mln rub

Total costs for 1 well (incl. purchasing costs

30 mln rub, repair and prospecting costs)                                          8 mln rub

Wells rate after repair works, mt/24h                                                3,0                              

Annual revenue per each well, rub                                                     13 mln rub (1095 mt)

Annual profit per each well, rub                                                         10 mln rub

Investment profitability (% per year)                                                         125%


The efficiency of the funds, which are invested in oil extraction applying advanced technologies on the abandoned oil fields, is:


Costs for oil fields purchasing (10 wells)                                          10-50 mln rub

Costs for electromagnetic prospecting                                                           1 mln rub

Wells repairing costs (per each)                                                         4-5 mln rub

Intensification costs                                                                            150 mln rub

Total costs for 1 well (incl. purchasing costs

30 mln rub, repair, prospecting and intensification)                          185 mln rub

Wells rate after repair works, mt/24h                                                100,0 (min)               

Annual revenue per each well, rub                                                     438 mln rub (36 500 mt)

Annual profit per each well, rub                                                         12 mln rub

Investment  profitability(% per year)                                             236%

 If wells rate after repair confirms hydrocarbons deposits existence, which were identified by electromagnetic prospecting, there will be next step to attract a service company (better American one) to carry on oil-producing intensification, what cause the well rate increase in 30 times minimum, and likely in 50 times.

                                                                                     I.     Intensification. Methods.

Not all oil reserves can be extracted. There is an oil recovery factor that calculated as a ratio of the volume of recoverable oil reserves to the volume of oil geological reserves.

Nowadays average value of this factor in Russia is 29-30% (in the USSR times it was 36-38%, according to world practice surveys it is - about 45 %, but on sites where advanced technologies are applied, it reaches 80%).

Hereby, taking into account that in Dagestan within last 110 years, 37 small oil deposits were discovered, from which it was extracted 40 mln mt of oil, there is a high probability to extract additionally minimum 40 mln mt of oil (even supposing that 30% of oil reserves has been already extracted). Really it was extracted not more than 20%

Advanced oil-producing technologies have never been applied on any preserved deposits.



Natural layer energy

Water/gas injection

Appliance of the advanced technologies

 Classification of the oil recovery increase methods

 By type of working agents the classification of known methods of the layers’ oil recovery looks like following:

1. Thermal methods:

• Steam-thermal impact on a layer;
• fire flooding;
• hot water drive;
• huff and puff treatment.

2. Gas methods:

• air injection;
• hydrocarbon gas effect;
• CO2 effect;
• Nitrogen, flue gas effects etc.

3. Chemical methods:

• drive by water solutions of SAA (incl. foam systems);
• polymer drive;
• alkaline solutions drive;
• acid drive;
• chemical compositions drive (incl. mycelia solutions etc.);
• microbiological effect.

4. Hydrodynamic methods:

• integrated technologies;
• non-draining reserves involvement into operation;
• barrier flooding in gas-, oil-bearing deposits;
• cyclic water flooding;
• forced drainage;
• graded thermal flooding.

5. Group of combined methods.

From the viewpoint of the effect on the layers system, a combined impact principle is applied in the most cases, which combines hydrodynamic methods with thermal ones, hydrodynamic methods with physical-and-chemical ones, thermal methods with physical-and-chemical ones etc.

6. Methods of well rate increase.

Particularly it is important to say about so called physical methods of the well rate increase.  It is incorrect to unite them with methods of oil recovery increase, because appliance of the oil-recovery increase methods are defined by increased potential of the driving agent, while in the physical methods potential of the driving agent is implemented by appliance of the natural layer energy.

Mostly applied physical methods are:

• hydrofracturing;
• horizontal wells;
• electromagnetic effect;
• waves actions;
• other similar methods.

                                   II.     Geological exploration works based on advanced technologies

 Within some last years for oil- and gas- exploration advanced technologies were created, that proved its’ efficiency by drilling results:

Differential – normalized electrical prospecting – DNEP

Various modifications of the electrical transient method in the near-field of source with the in-loop installation – PTF

Frequency-Time ElectroMagnetic 3D – FTEM-3D, patent RF №2446417.

In some cases to study geological environment and to forecast oil-bearing characteristics, vertical electrical penetrating by induced polarization method (VEP IP) is used, however the sphere of its appliance is limited by depths of 300-500 m.

The most important condition of efficiency of the geophysical methods is reliability of the target object model. All considered technologies to some extent lean on the diagnostic signs received as a result of a wide range of researches of geoelectric properties of hydrocarbons deposits, executed in Russia and abroad, including those which are carried on under the program so-called "Direct searches".

Such diagnostic signs are the abnormal effects connected with secondary (epigenetic) changes of a section. First of all this is an increase in specific electric resistance in an oil-saturated collector and the rocks which cover a deposit, as a result of hydrocarbons migration and a secondary section carbonatization. The second important sign is increase of polarizability of rocks in the near-surface deposits, caused by education electronic carrying-out minerals during sulph-treduction process at hydrocarbons migration up on a section.

Method PTF is widely used to study geo-electrical characteristic of the sites in oil-and-gas- bearing provinces, mainly on the regional-searching stage. The forecast is carried out on the basis of increase in electric resistance, the parameter of polarizability isn't defined and doesn't participate in the forecast.

FTEM-3D and DNEP technologies use all the same basic geo-electrical parameters - polarizability– and resistance of the geological environment. They use the standard fixed assets of the analysis and interpretation of data – the solution of straight lines and the return tasks, one-dimensional and three-dimensional modeling of the geo-electric environment. The basic difference consists in the accepted geo-electric models of object of researches.

DNEP technology leans on the model offered by Moiseyev V. S. on the basis of the induced potential logging analysis of wells on fields of Western Siberia. As it was stated earlier, by Pearson's researches, over hydrocarbons deposits the rocks column with a recovery situation of the environment which is replacing with oxidizing around 1st from a day surface of a regional water emphasis is formed. Exactly here, in a zone of a geochemical barrier, according to Moiseyev, in productive wells on induced potential logging curve area of sharp increase in polarizability is fixed.


Pic. 4. Data of induced potential logging of wells (by Moiseyev)

Based on this effect, the DNEP method directed on studying of layer-by-layer distribution of polarizing properties of the environment, allows mapping zones of diffusive auras of dispersion over deposits of hydrocarbons". Thus, the forecast of oil-bearing capacity is based on secondary changes of the environment in the top part of a section which not always have unambiguous communication with a deposit of hydrocarbons at a depth.

FTEM-3D technology uses fuller model in which the major element is the abnormal induced potential zone connected directly with a deposit of hydrocarbons.

The analysis of the data characterizing area of formation of a deposit, shows that, ware-oil contact (WOC) is no other than transformed "border undressed" phases. On "the edge of the section" of phases favorable conditions for restoration of sulphates (sulph-treduction), and concentration on it polar organic compounds of lipidic or other nature (air, fatty acids, alcohols), being characterized by high superficial activity" are created. The WOC area ("the border undressed" phases), possessing high polarizing properties, is electrically active part of a deposit.

The geo-electric model (pic. 5) on which the FTEM-3D technology leans, is based on results of the analysis of samples of a core and data logging. The deposit of hydrocarbons can be considered as abnormal on conductivity and polarizability local object located in a normal horizontally layered section. Anomaly of electric properties of rocks in the field of an arrangement of a deposit is caused by a number of the reasons:

– change of petrophysical properties of collectors;

– increase in a mineralization of reservoir waters in  near-contact zones of deposits;

– influence of the deposit, as a local high-resistance object;

– change of physical properties of containing rocks under the influence of migrating fluids, in particular, formation of auras of calcitation and pyritization;

– existence of "the edge of the section" phases (WOC) which possesses high polarizing properties and is electrically active part of a deposit.

Such approach is used in FTEM-3D electromagnetic prospecting. Appliance of this technique allows localizing object in the plan, and gives the chance to divide the deposits located at different depths, and depth of research can reach 5-6 km.


Рис.5. Geo-electrical model of hydrocarbons deposit

 Thus, FTEM-3D technology provides the most full both resistance and polarization characteristics of the geo-electric section from day surface down to crystal base, while PTF technology specifies a section on resistance only, and DNEP gives data about electrical parameters of the upper part of the section only.

Another principal difference between PTF, DNEP and FTEM3D is technological methods of works on site. The technique of works of these technologies provides: creation of an artificial electromagnetic field. For PTF (pic. 6) the field is created in horizontal ungrounded loop, measurements of a derivative vertical component of a magnetic field (dBz/dt) in a loop located in a feeding loop also are carried out.


DNEP technology (pic. 7.) provides: creation of an artificial electromagnetic field of a source in a form of the horizontal grounded feeding line and measurement of an electric component of an electromagnetic field, and along with tension on each of reception lines is registered also the differential signal which level is very low.



Pic. 7. DNEP installation.

 In FTEM-3D (pic. 8, 8а) the feeding source in a form of the grounded line is fixed on a site of works, and reception installation in the form of the horizontal electric line (MN) connected to multichannel station (24 channels), moves on a regular network of profiles.


 Pic. 8. FTEM-3D installation

 Technologically the heaviest part of installations is the feeding source that demands low resistance of grounding and a heavy low-impedance wire for providing good conditions of measurements (big currents, high level of a signal).

Techniques of PTF and DNEP demand movement on profiles of all installation, including feeding source that depending on an orogydraphyc and economical - industrial situation of the area of researches complicates creation of regular dense networks of measurements on a site of works, reduces productivity of works and increases their cost.

In FTEM-3D technology the source in a form of horizontal (for land works) or vertical (for borehole and superficial works) grounded line is fixed on the area of works and remains motionless, and measurements are carried out on a network of profiles. Such scheme of measurements provides high efficiency of works and necessary density of measurements, depending on shooting and research problem scale, in particular, allows conducting works in a complex with 3D seismic exploration.

Higher noise immunity, and, respectively, higher precision of measurements in frequency area in the FTEM-3D technology are to be noted as well.


 Pic. 9а FTEM-3D technique.



Republic of Dagestan
Siting of
oil exploration by Electromagnetic surveys FTEM-3D































Convective drying

Istra Micro HPP Flaw detector
South Sudan Lao RusHydro Guyana Amur Dagneft
Vietnam Mozambique Philippines Burkina Faso Tanzania Archeology
Dagestan Guinea Cameroon Armenia Booryatiya Ozonation