SGGA Monthly Report May 1 – May 31, 2016

The project is implemented by Advanced Engineering Associates International, Afghanistan, and is focused on the Sheberghan Gas Development Project (SGDP) area. The SGGA Monthly Report for May 1-31, 2016, highlights the project's achievements and challenges in the areas of drilling contract management support, SGDP natural gas development support, capacity development, and monthly expenditures. The report also provides an update on the project schedule and lists the acronyms and abbreviations used in the report. In the area of drilling contract management support, the SGGA team prepared a response to a letter from the Turkish National Petroleum Corporation (TPAO) challenging the Ministry of Mines and Petroleum's (MoMP) position on delay penalties and environmental remediation requirements. The team also prepared a TPAO contract summary document for MoMP to update new senior leadership on the overall history of the TPAO contract and remaining contract closeout issues. The SGGA team met with Z. Sarwari of MoMP on May 2 to discuss TPAO's contract claims attempting to justify performance delays. On May 24, the team met with Sarwari and discussed the negotiation strategy for a meeting with TPAO the following day. On May 25, the team attended a MoMP-TPAO meeting regarding contract closeout to assist MoMP in negotiations. The report highlights several challenges faced by the SGGA team, including TPAO's continued dispute over the amount of delay penalties and environmental remediation requirements. TPAO has also threatened to refer the unresolved issues to its legal department and has implied that it will seek to impose diplomatic pressure on the Afghan Government. The report also notes that MoMP remains unable to reach a conclusion of the contract without SGGA direction, due in part to the lack of assistance from within the Ministry. The SGGA team has requested that McDaniel provide a quote for data evaluation and resources estimate for the Juma-Bashikurd Field, as an alternative to the reservoir study provided for in Amendment 1 to the MoMP-TPAO contract. The report concludes by highlighting the project's achievements and challenges, and providing an update on the project schedule. The SGGA team continues to work with MoMP and TPAO to resolve the outstanding issues and move forward with the project.