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bln boe of proved hydrocarbon reserves
globally among publicly traded companies
by proved natural gas reserves under SEC
bcm of natural gas
produced in 2012
of total Russian
natural gas production
№7globally among publicly traded companies
by natural gas production volumes
of total natural gas deliveries
to the domestic market via the UGSS
OAO NOVATEK is Russia’s largest independent natural gas producer. The Company is principally engaged in the exploration, production, processing and marketing of natural gas and liquid hydrocarbons and have 20 years of operational experience in the Russian oil and natural gas sector.
Our principal operating areas are concentrated in the Yamal-Nenets Autonomous Region (YNAO) in Western Siberia. The YNAO is the most significant gas producing region in Russia, accounting for approximately 90% of Russia’s natural gas production and approximately 17% of global gas production.
As of 31 December 2012, we had 12.4 billion barrels of oil equivalent (boe) of SEC proved reserves. Our reserve replacement rate for the last five years was above 600%. Most of our reserves are located onshore or can be developed from onshore locations and are attributed to the conventional categories.
We aim to expand our resource base through geological exploration at fields and license areas not only in close proximity to existing transportation and production infrastructure, but also in new potentially prospective hydrocarbon areas. In the last 5 years we discovered 7 new fields and 61 new deposits. The organic replacement rate (excluding acquisitions) of our proved reserves amounted to 186%.
We carry commercial production of hydrocarbons at six fields. Our three core fields—Yurkharovskoye, East-Tarkosalinskoye and Khancheyskoye — accounted for approximately 90% of our production volumes in 2012. Our total production of marketable hydrocarbons amounted to 405 mm boe in 2012. In the last five years our hydrocarbon production grew at the compound annual growth rate of 14%.
Gas Condensate Processing
We process our unstable gas condensate at our Purovsky Plant, which produces stable gas condensate and liquefied petroleum gas (LPG). In June 2013 we launched processing of stable gas condensate at the newly built Ust-Luga Complex on the Baltic Sea. The Complex produces light and heavy naphtha, jet fuel, diesel fuel and heating/ship fuel.
We sell our natural gas to end customers in the Russian Federation (power generation companies, industrial users, regional gas distributors) and to gas traders. Stable gas condensate products are sold internationally, whereas our LPG and crude oil are sold domestically and internationally.
We generate revenues primarily from natural gas and stable gas condensate product sales and, to a lesser extent, sales of other liquid hydrocarbons. Our total revenues and EBITDA in 2012 amounted 211 bln RUB and 95.2 bln RUB respectively.
Shares and Credit Ratings
Shares of NOVATEK are listed on the Moscow Exchange and the London Stock Exchange (in form of GDR). NOVATEK has investment grade credit ratings from the three leading credit rating agencies - Moody’s Investor Services (Baa3), Standard & Poor’s (BBB-) and Fitch Ratings (BBB-).
Our strategy is to maintain our position as the leading independent natural gas producer in Russia, based on increasing our hydrocarbon production, while expanding our resource base, optimizing our marketing channels and exploring new projects.