NOVATEK : Marketing

NOVATEK’s three core fields account for approximately 99% of the Company’s total production of natural gas and liquid hydrocarbons. On a boe basis, natural gas accounts for 90% of our total production and approximately 62% of our oil and gas sales.

NOVATEK delivers gas to 35 regions from Western Siberia to European Russia. In 2009, NOVATEK’s share of total natural gas deliveries to consumers within Russia amounted to 10%.

Substantially all of the stabilized gas condensate produced at our Purovsky processing plant is delivered by rail to the Port of Vitino on the White Sea in the Murmansk region. At the Port of Vitino, the gas condensate is loaded on ocean-going tankers for further transportation to international markets. We have our own facilities for loading and storage of stabilized gas condensate at the Port of Vitino, including two storage reservoirs, each with a capacity of 30 mcm. Our storage and loading facilities enable us to better market and sell our gas condensate in international markets.

Throughout the year, we exported 36 tankers of stable condensate of which 67% went to markets in the United States, 25% to markets in the Asian-Pacific region and eight percent to markets in Europe. Over 97% of our 2009 stable gas condensate sales volumes were sold to the export market. We sold 99% of our stable gas condensate produced at the Purovsky processing plant to export markets, whereas our LPG exports, including exports to the CIS countries, represented 54% of our total LPG production.

The majority of NOVATEK’s crude oil is transported through the pipeline system operated by Transneft, Russia's largest pipeline operator. The crude oil that is transported through Transneft is blended with oil produced by other oil companies utilizing the Transneft network. The final sales are a blend that results from the combination of different types and qualities of oil transported through the system, and is known as "Ural’s Blend".