Inter RAO Signs On for Canadian Exploration

Electricity trader Inter RAO has signed a memorandum of intent with Canadian gas firm Tethys to work jointly on oil and gas exploration in Central Asia, Tethys said in a statement.

Tethys will provide operational and technical support, due diligence and market analysis while Inter RAO will investigate production opportunities, especially for gas, in Kazakhstan and other parts of the region, said the statement issued late on Thursday.

The board of Inter RAO is chaired by Prime Minister Vladimir Putin's powerful deputy Igor Sechin, who curates Russian energy policy and is the chairman of Russia's largest oil company, state-controlled Rosneft.

Its work with Tethys would be Inter RAO's first foray into oil or gas. Most of the firm's revenues come from the import and export of electricity, over which it has an effective monopoly in Russia.

One of the objectives listed in the memorandum is Inter RAO's possible acquisition of Tethys' existing assets in Kazakhstan.

Midsized Tethys produces natural gas in the Central Asian country with a target of 2 million cubic meters in output per day in 2009. It launched production last year at the Kyzykoi field and holds licenses to develop two other Kazakh gas fields, Akkulka and Kul-Bas.