22 Jan 2020 07:45
FOR IMMEDIATE RELEASE
NOVATEK's 2019 Organic Reserve Replacement Reached 252%
Moscow, 22 January 2020. PAO NOVATEK ("NOVATEK" and/or the "Company") today announced that independent petroleum engineers, DeGolyer & MacNaughton, have completed their comprehensive reserve appraisal of the Company's hydrocarbon reserves as of 31 December 2019.
Total SEC proved reserves, including the Company's proportionate share in joint ventures, aggregated 16,265 million barrels of oil equivalent (boe), including 2,234 billion cubic meters (bcm) of natural gas and 193 million metric tons (mmt) of liquid hydrocarbons. Total proved reserves increased by 3% (excluding 2019 production) as compared to the year-end 2018, representing a reserve replacement rate of 181% for the year, with the addition of 1,065 million boe, inclusive of 2019 production.
The organic reserve replacement rate, excluding the effect from acquisitions and disposals, which mainly related to the disposal of 40% participation interest in Arctic LNG 2 project, amounted to 252%, with the addition of 1,487 million boe, inclusive of 2019 production.
The Company's reserves were positively impacted by successful exploration at the Geofizicheskoye, Utrenneye and Kharbeyskoye fields, production drilling at the Urengoyskoye, East-Urengoyskoye+North-Esetinskoye (Samburgskiy license area), East-Tazovskoye, North-Russkoye and South-Tambeyskoye fields, as well as the discovery of the Nyakhartinskoye field and new Achimov deposits in the Gydanskiy license area. The Soletsko-Khanaveyskoye field acquired in 2019 was included into our reserves appraisal. The Company's reserves appraisal under PRMS standards also includes the new North-Obskoye field discovered in 2018.
The Company significantly increased its exploration activities in 2019 as well as acquired new license areas on the Gydan Peninsula. The inclusion of large geological discoveries in reserves appraised under international reserve standards will contribute significant hydrocarbon resources to successfully implement future NOVATEK's large-scale LNG projects in the Arctic zone and ensure the maintenance of natural gas production levels into the domestic pipeline network.
Under the PRMS reserves reporting methodology, the Company's total proved plus probable reserves, including the Company's proportionate share in joint ventures, aggregated 28,725 million boe, including 3,901 bcm of natural gas and 373 mmt of liquid hydrocarbons.
The organic proved plus probable reserves replacement rate under the PRMS standards, excluding the effect from acquisitions and disposals, which mainly related to the disposal of 40% participation interest in Arctic LNG 2 project, amounted to 200%, with the addition of 1,177 million boe, inclusive of 2019 production.
NOVATEK reserves according to international standards
Proved reserves under the SEC methodology | Proved plus Probable reserves under the PRMS methodology | |||
2019 | 2018 | 2019 | 2018 | |
Natural gas, bcm | 2,234 | 2,177 | 3,901 | 4,021 |
Liquid hydrocarbons, mmt | 193 | 181 | 373 | 387 |
Total hydrocarbon reserves,million boe | 16,265 | 15,789 | 28,725 | 29,619 |
Reserves to production (R/P) ratio* | 28 | 29 | 49 | 54 |
* R/P ratio represents total reserves at year-end divided by total production for the same year.
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Information provided in this press release represents expected results of PAO NOVATEK operations in 2019. The information represents preliminary assessment only, which can be adjusted after statistical, financial, fiscal and business reporting becomes available. The information on PAO NOVATEK's operational results in this press release depends on many external factors and therefore, provided all permanent obligations imposed by the London Stock Exchange listing rules are unconditionally observed, cannot qualify for accuracy and completeness and should not be regarded as an invitation for investment. Therefore, the results and indicators actually achieved may significantly differ from any declared or forecasted results in 2019. PAO NOVATEK assumes no obligation (and expressly declares that it has no such obligation) to update or change any declarations concerning any future results, due to new information obtained, any future events or for any other reasons.
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For further information, please visit www.novatek.ru or contact:
Press Service+7 (495) 721 2207press@novatek.ru | Investor Relations+7 (495) 730 6013ir@novatek.ru |
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PAO NOVATEK is one of the largest independent natural gas producers in Russia, and in 2017, entered the global LNG market by successfully launching the Yamal LNG project. Founded in 1994, the Company is engaged in the exploration, production, processing and marketing of natural gas and liquid hydrocarbons. The Company's upstream activities are concentrated mainly in the prolific Yamal-Nenets Autonomous Region, which is the world's largest natural gas producing area and accounts for approximately 80% of Russia's natural gas production and approximately 15% of the world's gas production. NOVATEK is a public joint stock company established under the laws of the Russian Federation. The Company's shares are listed in Russia on Moscow Exchange (MOEX) and the London Stock Exchange (LSE) under the ticker symbol "NVTK".