Novatek boosts gas resources with Alrosa assets acquisition

Novatek boosts gas resources with Alrosa assets acquisition

Russia’s largest independent natural gas producer and LNG operator, Novatek won the open auction to acquire Maretiom Investments and Velarion Investments from Alrosa.

The acquisition price following the auction amounted to 30.3 billion Russian Roubles ($537.1 million), Novatek said in a statement.

Geotransgaz, owned by Maretiom Investments, holds the hydrocarbon exploration and production license for the Beregovoy license area, containing estimated hydrocarbon resources of 436 million barrels of oil equivalent (boe) according to the Russian resource classification as of December 31, 2017, and produced 1.6 billion cubic meters of natural gas and 185 thousand tons of gas condensate during 2017.

The Urengoy Gas Company, 100 percent owned by Velarion Investments, holds the hydrocarbon exploration and production license for the Ust-Yamsoveyskiy license area, containing estimated hydrocarbon resources of 650 million boe according to the Russian resource classification as of December 31, 2017.

Novatek’s chief executive Leonid V. Mikhelson said, “One of our priorities, as highlighted in our recent Corporate Strategy Day, was to sustain our production levels within reach of the Unified Gas Supply System and in close proximity to our current transportation and processing infrastructure.”

The Beregovoy and the Ust-Yamsoveyskiy license areas fully meet the criteria Mikhelson said adding they will contribute to Novatek’s gas and liquids production to load its gas condensate processing chain thus maximizing the company’s profitability.

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