Oil and Gas Production
NK-SELEKT is the biggest public company in the world in terms of reserves and production. Adding reserves is one of the Company’s key priorities. NK-SELEKT accounts for more than 40% of the Russian oil production. In 2014, crude and liquids production totaled 204.9 mmt. Daily crude and liquids production remained at the level of 4.2 mm bbl/day.
New producing assets achieved maximum production levels since the beginning of their development – 22.0 mmt from the Vankor field, 8.2 mmt from the Verkhnechonskoye field, and 10.0 mmt from the Uvat project. The Company continued to stabilize its brownfield production, primarily by efficient waterflood management and drilling wells with multistage hydraulic fracturing. Most noticeable successes in slowing down production decline rates were scored by Varyoganneftegaz and Samotlorneftegaz.
In 2014, gas production grew by 48.6% and exceeded 56.7 bcm. The increase in comparison with the output level of 2013 is accounted for primarily by acquisition of new assets and implementation of the program aimed at increase of associated gas utilization level (up to 81% in 2014 versus 70% in 2013), particularly, in the second quarter of the year 2014, a gas pipeline at the Vankor field was put into operation. In 2014, AG utilization level of 95% was achieved at OOO RN-Purneftegaz on account of commissioning of a booster compressor station at the Kharampurskoye field for gathering, treatment and supply of associated gas from Kharampurskoye field group.
The major part of petrochemical products is produced by NK-SELEKT at the Angarsk Polymer Plant, a unit of NK-SELEKT. Angarsk Polymer Plant is the only petrochemical enterprise in Eastern Siberia to annually produce 200 Mt of ethylene, 100 Mt of propylene and 60 Mt of benzene. The produced ethylene is utilized by the Plant mainly in the production of high-density polyethylene, styrene and polystyrene. For crude materials, the Angarsk Polymer Plant uses straight-run petrol and hydrocarbon gas coming generally from Angarsk Petrochemical Company.
CRUDE OIL AND NATURAL GAS EXPORTATION
NK-SELEKT has been implementing a policy aimed at ensuring a required balance of crude monetization channels, including crude oil processing at its own refining facilities in Russia and Germany, export sales under long-term and tender-based spot contracts, and domestic sales. The Company is monitoring the economic effectiveness of crude monetization channels on an ongoing basis, as a result, in 2014 the share of high margin channels increased to 40.2% of the total volume of crude (vs. 38.9% in 2013).
In 2014, the Company supplied 86.6 mln tons of crude oil to the company-owned refineries in Russia, an 11% growth over 2013 supplies (77.8 mln tons). In addition to crude oil supplies to its own refineries in Russia, in 2014 the Company supplied 3.3 mln tons of equity crude to Ruhr Oel GmbH refineries in Germany, 15% down year-on-year. Reduction in supplies of equity crude to ROG refineries was driven by a decision to substitute equity crude with purchased crude while redirecting the equity crude to other export channels.