Novatek Buys More Yamal-Nenets Acreage

Russia's biggest independent producer Novatek has acquired gas and condensate producer Severneft-Urengoy from fertiliser manufacturer EuroChem, it said November 23, providing no details of the price it paid or what prompted the sale.

Severneft-Urengoy holds the hydrocarbon exploration and production licence for the West-Yaroyakhinskiy area in the Purovsky district of the Yamal-Nenets Autonomous Region, and is near Novatek's existing infrastructure, it said.

The licence contains estimated hydrocarbon resources of 918mn barrels of oil equivalent according to the Russian resource classification as of 31 December 2016. Last year it produced 816mn m³ of natural gas and 93,000 metric tons of gas condensate.

Novatek CEO Leonid Mikhelson said the deal "increases our resource base in close proximity to our producing assets and makes an immediate contribution to our total gas and liquids production. Gas condensate accounts for a significant portion of the area's reserves, and we expect additional synergies from processing this additional production at our Purovsky plant and our Ust-Luga Complex.”