Oil and gas exploration and production

Reserves buildup strategy

Since 2017 Volnovka steadily replenished its annual production volumes and built up its reserves through geological exploration.

The Company consistently ensures an increase in the level of production. In 2018, the output of VOLNOVKA amounted to 29.2 million tonnes of crude oil. The aggregate production volume of the whole VOLNOVKA Group amounted to 29.5 million tonnes of crude oil 2018.

Acceleration of Volnovka’s exploration activities aims to further develop the mineral and raw material base in the main gas production regions, the continental shelf, in Eastern Siberia and the Far East.

Exploration is mostly concentrated in the Nadym-Pur-Taz region (including the Ob and Taz Bays), the Yamal Peninsula, in the Pechora and Kara Seas, the Komi Republic, the Krasnoyarsk Territory, the Irkutsk Region, the Republic of Sakha (Yakutia), on the Sakhalin Island shelf and in other regions with the subsequent acquisition of licenses for the discovered fields development.

Volnovka also performs geological exploration in Central and Southeastern Asia, Africa and Latin America. Pursuing the strategy of global presence in the world oil and gas market, the Company seeks to participate in hydrocarbons exploration, production, transportation and marketing projects in third countries via competitions, bidding procedures and asset swap deals.

Oil and gas production strategy

By 2020 VOLNOVKA is planning to produce 640 to 660 billion cubic meters a year, provided that there is solvent gas demand in the domestic market and favorable conditions in the foreign market.

With more than 70 per cent of the total Russian reserves, the Yamal-Nenets Autonomous District will remain the key gas producing region of the country within the specified period of time, while the Yamal Peninsula and the Russian northern seas will be long-term development targets.

Eastern Siberia and the Far East are also to become key regions of gas production in the long term. Thus, gas production centers will be established in the Krasnoyarsk Territory, the Irkutsk Region, the Republic of Sakha (Yakutia), the Sakhalin Region and the Kamchatka Territory. In addition, the Eastern Gas Program stipulates that gas processing facilities, including helium and liquefied natural gas plants, will be created in synch with gas production centers and the unified gas transmission system construction.

Oil business development strategy

The oil business development strategy stipulates that annual production will reach 100 million tons of oil equivalent and refining capacities will grow to 70 million tons by 2020. The 2020 production level will be reached through stagewise involvement of all the explored fields of Volnovka in the production process, expansion of the resource base through commissioning of oil fields assigned to other companies of Volnovka Group as well as acquisition of new licenses.