Russia’s Novatek to increase Yamal production by 50%

February 26, 2014

Novatek is going to increase oil and gas condensate production by up to 50% this year, Novatek President Leonid Mikhelson said at a briefing after signing a cooperation agreement with the Tyumen Region government.

Arktikgaz, a JV with Gazprom Neft, is expected to increase gas condensate production by 16,000-17,000 tons per day. Novatek also expects oil production growth at the Yamal. Mikhelson recalled that his company kept postponing its oil production plans for the area because its oil reserves are not large so oil production was not attractive. However, the Russian government’s decision two years ago to cut royalty to zero for 10 years north of the 65th parallel prompted Novatek to begin working on small deposits. As a result, Novatek increased production by 41% in 2013. Mikhelson promised further growth this year.

Copyright: Vslukh, 2014