ENERGY FOR PEOPLE - JSC Gazprom Neft

KEY PERFORMANCE INDICATORSOF THE COMPANY IN 2009 BY TYPEOF OPERATIONEnergy for lifeENERGY FOR PEOPLERESOURCE BASEGazprom Neft Group’sHydrocarbon Reserves’Growth by SPE (PRMS)2019,51918,51817,51716,51615,51514,5SOURCE:COMPANYDATA2005 2006 2007 2008 2009For more than 10 years the Company’sreserves have been audited by SPE(Society of Petroleum Engineers)standards and more conservative SEC(US Securities and ExchangeCommission) standards. The audit hasbeen conducted for all fields based onthe estimates of a representativesample of JSC Gazprom Neft’s fieldsaccounting for 95–98% of RussianABC1 category.According to independent reservoirengineers, DeGolyer and MacNaughton(Miller and Lents in 2007 and 2006), asof December 31, 2009 JSC GazpromNeft had total reserves of “proven” and“probable” categories (including theCompany’s share in equity investees) bySPE standards of 1 568 mln t ofhydrocarbons (11 531 mln bbl).The current reserves-to-production ratioof Gazprom Neft’s SPE provenhydrocarbons is 20 years.In 2009 additions to Gazprom Neft’sSPE proven hydrocarbon reserves (nottaking into account the newacquisitions) totaled 97 mln TOE. By theresults of 2009, the replacement ofGazprom Neft’s proven hydrocarbonreserves amounted to 265%.Additions to Gazprom Neft’s SPEproven hydrocarbon reserves entailedby the new acquisitions amounted to 41mln TOE in 2009.EXPLORATIONIn the reporting period 11 explorationand-appraisalwells were completed inthe license plots of JSC Gazprom Neftand its subsidiaries, of which 10 yieldedcommercial hydrocarbon inflows. Totalexploration meters drilled in 2009 —17 037 line m, which is 26% comparedto 2008. This decrease in explorationdrilling metreage in 2009 as comparedto 2008 was connected with theprogram on reducing capital expensesand with less investment in explorationactivities in particular.The exploration drilling success ratewas 90.9% with efficiency of 561 tonsof hydrocarbons per meter drilled and121.6 rub/TOE.The conducted exploration workresulted in the discovery ofNizhnevyngapurovskoye oil andgas condensate deposit in theVyngapurovskoye license plot and 3new oil reservoirs in the existing fieldswith total recoverable C1 and C2 oilreserves of 4.070 mln tons and 4.145mln tons, respectively.Overall in 2009 additions to theCompany's reserves of commercialcategory totaled 105.6 mln tons,resulting mostly from additionalexploration in the fields underdevelopment (65.9 mln tons) as wellas from re-estimation of reservesdue to the revision of the geologicalmodels of the fields and oil recoveryfactors, primarily for the Priobskoye andSutorminskoye fields (39.7 mln tons).In the reporting period 3D and 2Dseismic surveys of 2 200 sq km and1 234 line km, respectively, wereconducted in the license plots of JSCGazprom Neft and its subsidiaries.In 2009 of the 60 tested zones 35yielded commercial oil inflows,condensate and gas, 6 — noncommercialoil and gas inflows, 9yielded no inflow, the remaining 10zones yielded either reservoir waterinflows or those slightly admixed with oil.The financing of exploration by JSCGazprom Neft and its subsidiaries in2009 totaled 3.6 bn rub, which is 65% ofthe financing provided in 2008.In the reporting period on the licenseplots OJSC NGK Slavneft conductedexploration costing 2.4 bn rub (excl.VAT), including exploration drilling of 13960 meters costing 1.9 bn rub, 3D and2D seismic data processing for 0.05bn rub; research and other types ofactivities for 0.5 bn rub.In the reporting period on the licenseplots OJSC Tomskneft VNK conductedexploration costing 0.4 bn rub (excl.VAT). Exploration drilling metreage in2009 totaled 2 800 meters, the amountof 3D seismic exploration work was233 sq km, the amount of 2D seismicexploration work — 414 line km.In 2009 Gazprom Neft boughtrecoverable reserves of crudehydrocarbons of OJSC OC Magma andNIS-Naftagas (Serbia) totaling 25.7 mlntons (C1+C2 taken together), including9.5 mln tons of NIS-Naftagas.40