Page 13 - FSUOGM Week 16 2021

FSUOGM PROJECTS & COMPANIES FSUOGM

Rosneft commissions next Uvat field

RUSSIA ROSNEFT has commissioned the next field in taken over by Rosneft in 2013. Today it con-
its Uvat project in Western Siberia, one of its sists of over 40 fields and has been a key source
Technologies such as largest greenfield developments. of growth in Rosneft’s portfolio in recent years.
multi-stage fracturing The first active well at the Pikhtovoye field Its largest fields are Ust-Tegusskoye and Urn-
will be employed. in the Tyumen region is currently flowing at a enskoye. Rosneft’s RN-Uvatneftegaz subsidiary
rate of more than 100 tonnes (7,300 barrels per that manages the Uvat project produced 213,000
day). Production drilling began last November. barrels of oil equivalent per day in 2019, includ-
Over the next few years, the plan is to drill over ing 206,000 boepd of crude oil.
30 wells, including horizontal ones, Rosneft said Rosneft continues to commission new
on April 19, from two pads using a rig attached fields to offset decline at its older fields in West-
to a conveyor. This reduces commissioning time ern Siberia and the Volga-Urals basin. But the
and the amount of drilling fluid needed. pace of development has slowed dramatically
Technologies such as multi-stage hydrau- in recent years because of OPEC+ restrictions,
lic fracturing will be used to boost reservoir which have been in force since the start of 2017.
productivity, Rosneft explained. Pikhtovoye’s Significant production cuts were imposed across
reserves, estimated at 8.5mn tonnes (62.3mn the group last spring in an attempt to rebalance
barrels), are classified as hard to recover. the market following the impact of the coronavi-
The field was discovered in 1992 and is part rus (COVID-19) pandemic to demand.
of the Tyamkinsky cluster of Uvat fields. Rosneft Rosneft’s liquids output declined 11.2% year
previously carried out a 3D seismic survey at the on year in 2020 to 204.51mn tonnes (4.1mn bpd)
site and drilled three exploration and appraisal in 2020, as a result of OPEC+ policy. Notable
wells. Infrastructure was built to carry the field’s recent field start-ups by the company included
oil to a central gathering point at the nearby the Severo-Danilovskoye field in Eastern Siberia
Tyamkinskoye field. and the Erginsky licence area in Western Siberia,
The Uvat project was formerly owned by in the fourth quarter of 2020 and the first quarter
BP-Russian joint venture TNK-BP, which was of 2021 respectively. ™

NEWS IN BRIEF

RUSSIA pipeline is tied with exerting control over analyst at the Moscow-based Sberbank CIB
gas flows between its key export markets of asset management firm said in a research
Gazprom’s Mongolia gas Europe and China. note.
Gazprom said that it expected another
pipeline pre-feasibility study to be finished before the end of this Gazprom could surprise on
year. It would provide an estimate for
study determines optimal required capital investments in Soyuz- 2020 dividends
Vostok and its operating costs after it is
route to China commissioned. The management of Russian gas giant
Industry reports in Moscow have already
Gazprom has determined the optimal route suggested higher than usual construction state-controlled Gazprom is considering
for the planned Soyuz Vostok (Mongolia costs as the future gas pipeline will require recommending a dividend of over RUB12
route section) pipeline to China, according additional protection from earthquakes as it per share for 2020, which would translate
to its pre-feasibility economic analysis passes an area with high seismic activity in into 50% of net profit payout, according to
released on April 12. Mongolia. Interfax.
The Soyuz-Vostok pipeline will be a “Early this year, Gazprom CEO Alexei As reported by bne IntelliNews, despite
continuation of the Russian Power of Miller stressed that the FEED for Power the losses sustained in 2020, the market
Siberia 2 gas pipeline. It will stretch across of Siberia-2 would be ready in 1Q21. The expected the company to stick to the
1,000 kilometres from the eastern part of fact that the new deadline for the FEED current dividend plan despite the strain
Mongolia, passing through the capital city, for the Mongolian part of the pipeline has on finances. Gazprom has previously
Ulaanbaatar. been moved to the end of this year suggests reiterated its dividend policy, but now could
Gazprom has also determined the that the FEED for the entire Power of reportedly surprise the market with a higher
general parameters for the gas pipeline such Siberia-2 is being delayed as well. According payout.
as the diameter and length of the Mongolia to our analysis, the export netback at the "Gazprom's recommendation could be
transit segment, the number of compressor Russian border for Power of Siberia-2 about 30% higher than we had expected,"
stations to be built and operating pressures, could be around $200/mcm, or close to Sberbank CIB commented on April 14.
Upstream reported on April 13. the pricing for Power of Siberia, implying Even though the difference in yields is
Power of Siberia 2 gas pipeline will a 13% unleveraged IRR. So the project moderate, this means that the management
be 6,700 kilometres long and capable of could generate appropriate returns for the could decide to raise the payout ratio to
delivering 50bn cubic metres per annum of company. However, we continue to believe 50% or even slightly higher one year earlier
gas to China’s capital, Beijing. that the project FID will only be possible if than previously planned, Sberbank CIB
For Gazprom the significance of the a new long-term gas contract is signed,” an analysts note.

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