Novatek Increases Liquid Production, Decreases Gas Sales in 1H 2015

Russia’s Novatek reported a 27% increase in oil and gas sales and a simultaneous 43% operating expenses jump in the second quarter of 2015 with respect to the same period in 2014. Profit from operations registered a slight decrease, but normalised profit attributable to Novatek shareholders increased over good results of its joint ventures. 

The share of profit of joint ventures, net of income tax, did indeed increase from 3,768 millions of Russian roubles in the second quarter of 2014 to 13,004 millions of Russian roubles in the second quarter of 2015. 

Looking at the first half of the year, the trends were similar. 

‘In the second quarter and first half 2015, our total revenues increased by 27.0% and 27.6%, respectively, compared to the corresponding periods of 2014. The growth was mainly due to an increase in liquids sales volumes and net prices in Russian rouble terms’ Novatek wrote on Wednesday. 

Natural gas production increased 7.8% in the first half of the current year with respect to 2014, while the liquids production jumped from 2,742 mt in 1H 2014 to 4,189 mt in 1H 2015. 

In terms of sales, natural gas suffered, and liquid hydrocarbons allowed the company to report positive financial results. 

‘Our natural gas sales volumes totalled 14.5 billion cubic meters (bcm) in the second quarter 2015 and 30.5 bcm in the first half 2015, representing a decrease of 8.5% as compared to the first half 2014… In the first half 2015, liquid hydrocarbon sales volumes amounted to 5,745 mt, representing a 77.8% increase as compared to the first half 2014’ the second gas producer in Russia explained on its website.