NOVATEK acquires a 49% stake in Nortgas

Russia-based natural gas producer NOVATEK has acquired 49% equity stake in ZAO Nortgas from R.E.D.I. HOLDINGS for $1.375m.

Nortgas holds the licence for hydrocarbon production in the Severo-Urengoyskoye field, located in the Nadym-Pur-Taz and Purovskiy regions of the Yamal-Nenets Autonomous District, Russia, and is close to the company’s existing production, transportation and processing infrastructure.

The Severo-Urengoskoye field, where hydrocarbon deposits have been allocated between the eastern and western domes, produced 3.1billion cubic meters of natural gas and 320,000t of de-ethanised gas condensate in the first nine months of 2012.

In 2001, commercial production started at western dome and it is expected that the commencement of production at the eastern dome will double the field’s natural gas output and triple the output of gas condensate.

NOVATEK’s chairman, Leonid Mikhelson, said the acquisition of Nortgas will expand the company’s reserve base as well as raise the production profile in the core region of the company’s operations.

"We expect significant synergies due to Severo-Urengoyskoye field’s close proximity to our existing assets and infrastructure, which will primarily result in additional returns from processing gas condensate at our Purovsky plant and the Ust-Luga complex," said Mikhelson.

Established in 1994, NOVATEK is Russia’s largest independent gas producer and the second-largest natural gas producer in the country. It is engaged in the exploration, production, processing and marketing of natural gas and liquid hydrocarbons.

The deal is expected be complete by the end of 2012.