GEOLOGY

Total number of subsoil licenses held by the Company’s subsidiaries - 167

Total number of oilfields - 167

Company assets are segregated into the following groups based on their location:


1. West Siberia group

2. Ural group

3. Volga group

4. Central Siberia group

Oil bearing capacities of Ural and Volga group belong to terrigenous and carbonate rocks of middle to lower Carbon and Devon; the West Siberia group belong to Neocomian and Malm.
Oil&gas discovery potential depends on detailed qualitative 2D/3D seismic and increase of its volume as well as on prospecting and exploration drilling both at the identified deposits and at newly acquired blocks.
In 2011 production was completely compensated by commercial reserves increase. A new oil deposit was discovered in Missisipian rock at Truyevskaya site (the Penza region); new oil pools were discovered at Osinovskoye oilfield in the Saratov region and at Sobolinoye in the Tomsk region. The boundaries of earlier identified oilfields  within the liits of Tagrinskoye,
Verkhne-and Nizhne-Shapshinskoye,Golevoye, Zapadno-Varioganskoye, Zapadno-Malobalykskoye oilfields in KhMAO, Stolbovoye and Verkhne-Salatskoye in the Tomsk region, Yuskinskopye and Pionerskoye in Udmurtia  were extended.   Geologic exploration started in Mauritania and Azerbaijan within the frames of OAO NK RussNeft participation in overseas projects.

In the short term RussNeft intends to implement geologic exploration policy, based on five principles:

1.  Further appraisal of the fields, being under development and in operation, mainly through additional deepening of production wells with the aim of prospecting and exploration of new HC deposits in deep set oil&gas  bearing horizons. 

2.  Increase of prospecting and exploration drilling efficiency based on iproving 2D and 3D seismic  quality permitting to map complex HC traps in details..

3. Determination of potentially promising new subsurface areas and their acquisition based on the geologic and economic evaluation.

4. Prospection and exploration of new oilfields and HC deposits within the boundaries of the existing license areas.

5. Secure annual replenishment of the Company resource base. 


RESERVES

OAO NK RussNeft has independent audit results of oil and gas reserves as of January 1, 2012.
According to Miller and Lents (USA), the total amount of the Company reserves as of January 1, 2012 is as follows: 

Oil:

Proved reserves:               1 653.046 mbbls;
Probable reserves:               619.958 mbbls;
Possible reserves:                820.681 mbbls.

Gas:

Proved reserves:              1 037 947 mcbf;
Probable reserves:              271 843 mcbf;
Possible reserves:               287 316  mcbf.

Oil and gas reserves were evaluated following new SPE/WPC/AAPG/SPEE (Society of Petroleum Engineers-US SPE, World Petroleum Congress - WPC and Society of Petroleum Evaluation Engineers - SPEE) requirements, enacted on March 28, 2007.