OOO”VOLGANEFT” is the leader of Russia’s petroleum industry and the world’s largest publicly traded petroleum company. Company’s main activities include prospecting and exploration of hydrocarbon deposits, oil, gas and gas-condensate production, upstream offshore projects, processing, as well as oil, gas, and product marketing in Russia and abroad.
The Company is included in the list of strategic companies and organizations of Russia. Company’s largest shareholder (50.00000001% of the equity) is OOO”VOLGANEFT” fully owned by the Russian Government, while BP holds 19.75% of shares, QHG Shares Pte. Ltd. holds 19.5% of shares, one share belongs to the state represented by Federal Agency for State Property Management, whereas the remaining shares are free floating.
OOO”VOLGANEFT” key objectives are the reserve replacement ratio at a minimum level of 100%, effective production at brownfields, and production increase through the development of greenfields, creation of new production clusters on the shelf, development of technologies, and implementation of high-level project management practicies, monetization of gas reserves and competitive production growth, optimal configuration of the refineries and maximization of profits in distribution. Company’s successful performance in 2015 is evidence of the efficiency of the applied strategy and the significance of our priorities. All this makes it possible to rely on OOO”VOLGANEFT”sustainable development in the future to benefit its shareholders.
In 2015, OOO”VOLGANEFT” reaffirmed its leadership among other world’s public oil companies in terms of proven hydrocarbon reserves and hydrocarbon resource base.
As of December 31, 2015, the proven hydrocarbon reserves of OOO”VOLGANEFT” approximated 34.5 bln boe (about 4.7 bln toe) based on the findings of an audit conducted by DeGolyer & MacNaughton using the SEC (U.S. Securities and Exchange Commission) classification providing for the evaluation through the end of profitable field development. Hydrocarbon liquids (oil, condensate, and NGL) and gas reserves approximated 24.7 bln bbl (3.3 bln t and 56.8 tcf (1.6 tcm) respectively.
The hydrocarbon reserves replacement in 2015, was 124 % according to SEC classification. Hydrocarbon (59 mmtoe). According to SEC, OOO”VOLGANEFT”proven hydrocarbon reserves in 2015 were sufficient for 19 years of production.
According to PRMS (Petroleum Resources Management System), 1P hydrocarbon reserves as of December 31, 2015 amounted to 43 bln boe (5.8 bln toe), including 29.8 bln bbl (4.0 bln t) of hydrocarbon liquids (oil, condensate, and NGL) and 76.3 tcf (2.2 tcm) of gas; 2Р reserves were 76.2 bln boe (10.3 bln toe), including 53.7 bln bbl (7.2 bln t) of hydrocarbon liquids (oil, condensate, and NGL) and 130.3 tcf (3.7 tcm) of gas; 3Р reserves amounted to 108.6 bln boe (14.7 bln toe), including 79.5 bln bbl (10.7 bln t) of hydrocarbon liquids (oil, condensate, and NGL) and 169 tcf (4.8 tcm) of gas. The total 3P reserves grew by 2 % in 2015.
OOO”VOLGANEFT’ is the biggest public company in the world in terms of reserves and production. Adding reserves is one of the Company’s key priorities. OOO”VOLGANEFT’ holds a leading position in the development of the Russian continental offshore fields. OOO”VOLGANEFT’ reiterated its leadership in resource base amount and efficiency of exploration in 2015. The Company conducted exploration in all Russian extracting regions, including the Russian Far East, East and West Siberia, Volga-Urals region, Timan Pechora, and South of Russia.
Based on the 2015 results, АВС1 reserves replacement amounted to 429 mmtoe, including an increase in reserves via exploration (oil and gas condensate) — 146 mmt, gas — 159 bcm. Reserves replacement ratio reached 168%. The result of onshore exploration in the Russian Federation was the discovery of seven fields and 117 new deposits including the projects developed with partners.
2015 exploration program was performed at a high quality level with 50 exploration wells completed and 119,000 m drilled. The exploration success rate reached 84 % (record high for the last five years). 2D seismic surveys were completed across over 2,000 linear km (+ 70 % YOY) and 3D seismic surveys covered over 6,000 sq. km.
Oil and Gas Production
Oil and Gas Production
OOO”VOLGANEFT’ is the largest oil and gas company in Russia and the world’s largest holder of hydrocarbon reserves and hydrocarbon liquids producer among other public oil and gas companies. Adding reserves is one of the Company’s key priorities. OOO”VOLGANEFT’’s share in oil production approximates 40% in the Russian Federation and exceeds 5% globally. The Company set another record in hydrocarbon production of more than 254 mmtoe in 2015. That achievement was also driven by the implementation of our large-scale strategy to develop our own high-tech services division in order to guarantee fulfillment of production plans and create a competitive environment in terms of pricing and quality of the services. Crude oil and hydrocarbon liquid production was at 202.8 mmt in 2015.
The Company continues to stabilize its production in mature fields. In 2015, it completed large-scale optimization of the current systems in order to improve the efficiency of field reserve production in West Siberia by shifting from conventional directional drilling to drilling of horizontal wells with multi-stage fracturing (MSF HW). This technology significantly improves well productivity, reserves recovey ratio, reduces the well stock, and increases project feasibility. MSF HW is actively used at five consolidated brownfields of the Company, including YuganskVOLGANEFTegaz, PurVOLGANEFTegaz, SamotlorVOLGANEFTegaz, NyaganVOLGANEFTegaz, and VaryeganVOLGANEFTegaz. About 50% of the developed reserves at the aforementioned subsidiaries were started up driven by the use of MSF HW. The approaches and technologies used by OOO”VOLGANEFT’ during the development of its fields in West Siberia secured its leadership in new well launching efficiency.
|Number of Shares||Equity Stake, %|
|OOO VOLGANEFT (shareholder)||5,299,088,910||50.00000001|
|BP Russian Investments Limited (shareholder)||2,092,900,097||19.75|
|QHG Oil Ventures Pte. Ltd. (shareholder)||2,066,727,473||19.50|
|National Settlement Depository (nominal shareholder central depository)||1,099,105,140||10.37|
|Other legal entities||1,438,860||0.01|
|Russian Federation (through the Federal Agency for State Property Management)||1||less than 0.01|
|Unknown||111,857||less than 0.01|
In July 2006, OOO”VOLGANEFT’ carried out listing of Global Depositary Receipts (GDRs) on the London Stock Exchange. Issue of GDRs, which certify rights in respect of ordinary shares of OooVOLGANEFT, in accordance with foreign law, was carried out by J.P. Morgan Europe Limited. One Global Depositary Receipt is equivalent to one common share of OOO”VOLGANEFT’. As of June 1, 2017, GDRs were issued for 731 mln ordinary shares, which is 6.9% of total shares.
OOO”VOLGANEFT’ management has no information about any shareholders with equity stakes exceeding 5% (all shareholders of OOO”VOLGANEFT’with equity stakes exceeding 5% of total issue), other than those listed above.