Map of OperationsLicense Table
NOVATEK has been able to expand its resource base through geological exploration works at fields and license areas in close proximity to existing transportation and production infrastructure. The Company continues to efficiently develop its reserve base and increase the ultimate level of hydrocarbon recovery at its fields as a result of many years of operational experience in the YNAO and by utilizing state-of-the-art exploration and development technologies.
In 2012, NOVATEK achieved significant growth in its reserves due to successful exploration at the Company’s fields, ongoing production drilling, the inclusion of Salmanovskoye (Utrennee) and Geofizicheskoye fields acquired in 2011 into the reserve appraisal (the reserves of these two fields increased substantially in 2012 due do exploration works conducted during the year), as well as the acquisition of an equity stake in ZAO Nortgas, which holds the license for the North-Urengoyskoye field.
As of 31 December 2012, NOVATEK’s SEC proved reserves totaled 12,394 mmboe, based on our equity ownership interest in the respective fields, representing a 32% increase compared to proved reserve volumes as of the end of 2011. In 2012, we added 3,405 mmboe of proved reserves under the SEC reserves reporting standards, inclusive of 2012 production, and recorded a more than eight-fold (842%) reserve replacement rate (874% for natural gas). Total proved reserves of natural gas increased to 1,758 bcm or by 493 bcm, inclusive of 2012 production. At year-end 2012, the Company’s reserve to production ratio (or R/P ratio) increased from 25 years in 2011 to 31 years.
Under the PRMS reserves reporting methodology, the Company’s total proved reserves increased by 4,665 mmboe, inclusive of 2012 production, and aggregated 15,597 mmboe. Total proved plus probable reserves (2P reserves) increased by 45% to 22,355 mmboe, including an increase of natural gas reserves by 1,054 bcm, inclusive of 2012 production, to 3,106 bcm.