KIEV, May 8 - CBM Oil plc, a private U.K.-based oil company, is in talks with the Ukrainian government over exploration and production of oil and gas offshore the Black Sea, the Energy and Fuel Ministry reported.

Michael Burchell, the chairman of CBM, met Energy and Fuel Minister Yuriy Boyko Tuesday for the talks seeking to secure a deal that would allow the company to join a major natural gas project.

???We had the talks on the future cooperation in exploring the offshore area of the Black Sea,??? Boyko said in a statement after the meeting. ???This is a strategically important course for our country as we see [the offshore deposits] as the key in providing Ukraine with the energy resources.???

CBM??™s talks are primarily focusing on the Gordiyevicha field that is estimated to contain up to 100 billion cubic meters of natural gas, according to data posted on CBM??™s Website. The field is located at the depth of 4,500 meters.

CBM is the third western private oil company that has been involved in the talks with Ukraine over searching for oil and gas in the Black Sea. Hunt Oil and Vanco Energy, two U.S.-based oil companies, have been holding talks with Ukraine on similar projects over the past two years.

Vanco in April 2006 outbid ExxonMobil and Shell and a number of smaller companies to win the right for negotiating a Production Sharing Agreement, or PSA, on exploration and production from an offshore area near Kerch in the Black Sea. The area is believed to contain up to 100 million metric tons of oil, according to estimates by Ukrainian officials.

Vanco??™s talks with the Ukrainian government over the PSA, however, stumbled since August 2006 after pro-Western government of Prime Minister Yuriy Yekhanurov had been replaced with pro-Russian government of Prime Minister Viktor Yanukovych.

CBM will continue the talks with the Energy and Fuel Ministry on Thursday, Boyko said, adding that the parties should be able to strike an agreement within one month.

Once the agreement is reached, CBM is expected to sign a joint venture agreement with ChornomorNaftoGaz, a state-owned oil and gas company responsible for exploration and production offshore the Black Sea, according to the ministry.

Burchell told Boyko that CBM would be able to attract $25 million financing for conducting a seismic research in the area, according to the ministry??™s report.

Burchell, 66, is also the chairman of Gold Oil plc, which has recently drilled a well onshore Peru, operates a very large deepwater block offshore Peru and has oil and gas production from the Nancy, Burdine and Maxine oil fields in Colombia.

Burchell has been an adviser to the Bahrain government on oil and gas since 2001 and negotiated for Bahrain three Production Sharing Contracts as well as participating in discussions with Iran and Qatar for joint gas development projects in the Gulf.

CBM was founded in 2004 by oil and gas professionals to acquire and develop interests in the Caspian, the Black Sea and the Mediterranean, with a focus on projects in the Commonwealth of Independent States.

CBM is currently also negotiating with the State Oil Company of the Azerbaijan Republic, or SOCAR, to put together four near-shore prospects under a PSA: Alat-Deniz, Karadag-Deniz, Gum-Deniz and Turkyan-Deniz. (tl/ez)