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NOVATEK is continuously seeking to increase its hydrocarbon resource base through geological and geophysical exploration activities conducted in close proximity to the existing transportation and industrial infrastructure. By employing modern exploration methods and data processing techniques, we seek to maximize the ultimate recovery of hydrocarbons from our fields, and efficiently exploit our reserves on a cost-effective basis.
Our efforts to find and develop natural gas and gas condensate fields have produced exceptional results, as evidenced by the fact that our reserves grew faster than production. In 2008, we successfully replaced 220% of our production volumes on a boe basis from our appraised fields.
In 2008, the Company continued exploration work at its international exploration project, the El-Arish offshore block in Egypt, investing RR 346 million on running and interpreting 1.1 thousand square kilometers of 3D seismic. Based on the interpretative results of the seismic data we have identified a number of highly prospective layers and thus plan to begin exploration drilling in 2010.
In 2009 the Board of Directors of OAO NOVATEK approved the acquisition of a 51% equity stake in OAO Yamal LNG holding the license for exploration and development of the South-Tambeyskoye field. The South-Tambeyskoye field was initially discovered in 1974, the field is located in the north-east of the Yamal Peninsula. As of 1 January 2008, the field’s natural gas reserves in accordance with the Russian reserve classification (categories C1 + C2) amount to 1.256 tcm.
In 2009, the Company added approximately 2,127 million barrels of oil equivalent (boe) of proved reserves under SEC reserves reporting methodology (SEC standards), inclusive of 2009 production. The growth in proved reserves was mainly attributable to organic reserves growth through development drilling and the finding of new layers at the Yurkharovskoye field as well as the positive impact of the South Tambeyskoye field acquisition on the Company’s total reserves base.
NOVATEK license areas
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