14 July, 2004 OAO Novatek has begun installing equipment at its Purovskiy Condensate Stabilization and Liquid Extraction Plant, which is being constructed due to the Company’s growing volume of gas condensate production, inadequate access to condensate pipelines and Gazprom’s processing plants and a reduction to the quota of independent producers by these plants due to increases in Gazprom’s own production and condensate processing.
The Purovskiy’s Plant’s tanks and column stabilizers will be supplied by OAO Kurgankhimmash; heaters – by OAO Penzakhimmash and air cooling units - by OAO Borkhimmash. Equipment supply contracts have been signed with 35 Russian companies as well as foreign suppliers who will furnish specialized equipment, in particular, a condensate and a natural gas liquids loading unit for rail tank cars produced by Scherzer, Germany, and valves supplied by Hungarian manufacturer, DKG-East. The support facilities; garages, fire station, storage, repair shops, service and operation block, boilers and water intake facilities are also being completed as is work at the rail car loading area. Two additional railway lines are being built at the “Limbey” rail crossing and a 4.2 kilometer access road has been completed. Railway lines are scheduled to be completed in September 2004.
The construction of the Purovskiy Plant began in October 2003 and is a mutli-phase project with initial throughput capacity of 2 million tons per annum. Fifty-five percent of the planned capital expenditures have already been expended and more than 650 persons and over 80 pieces of equipment are currently operating on the site. The plant is scheduled to be completed by January 1, 2005, and launched after start-up operations in the first quarter of 2005.
The project with an estimated cost of USD 150 million has been financed through internally-generated cash flows and external loans and credits. The Company is currently studying the feasibility to expand the Plant’s processing capacity up to 5 million tons per annum.
Press-Service of OAO NOVATEK Investor Relations
Tel.: (095) 721-2207 Tel.: (095) 730-60-20
press@novatek.ru ir@novatek.ru
NOTE:
OAO NOVATEK (www.novatek.ru) - is the largest independent gas producer in Russia. The company’s largest fields - Yurkharovskoye, East-Tarkosalinskoye and Khancheyskoye are situated in the Yamal-Nenets Autonomous Region, which accounts for approximately 90 per cent of all Russian gas production. The company controls and has equity stakes in the following production companies: OOO Yurkharovneftegas, OAO NK Tarkosaleneftegas, OOO Khancheyneftegas, OAO Purneftegasgeologia, OOO Geoilbent, OAO Selkupneftegas and OAO Tambeyneftegas.
About the Plant:
The Purovskiy Condensate Stabilization and Liquid Extraction Plant is located at the Limbey rail crossing (475th kilometer of Surgut-Urengoy railway) 20 kilometer to the north of the Purovsky station located in the Purovsky district of the Yamal-Nentes Autonomous Region. The project’s general design and management is being supervised by OAO UzhNIIprogaz, Donetsk, and the general contractor for the project is OAO “Trest”Sibcomplectmontazhnaladka”, Tyumen. The Purovskiy Plant is intended to process de-ethanized unstable gas condensate feedstock from Novatek’s gas condensate fields: East-Tarkosalinskoye, Khancheyskoye, Yurkharovskoye and from future production from the Olimpiysky license area. Throughput capacity for the plant’s first phase will be 2 million tons per year with the following commercial products output (thousand tons per year) available for sale after processing:
• Stable condensate - 1,590,0 ktpa
• Liquefied petroleum gas - 400,0 ktpa
Several other independent producers have expressed an interest in using the plant’s facility to process their unstable gas condensate. As a result, plans to expand the plant’s capacity to 4-6 mln tons per year are currently being reviewed. According to plans, the commercial products will be transported by rail for further processing. The plant will consist of the following facilities:
- Condensate stabilization unit with gas fractionation and combustion heater sections;
- Feedstock and gas fuel measuring and reducing unit; Flare system;
- Pressurized air compressor station for metering equipment and nitrogen facilities;
- Auxiliary technical units;
- Support and service facilities;
- Fire station;
- Tank farms and loading facilities for natural gas liquids and stable condensate;
- Train station “Zavodskaya” with track and facilities;
- Waste facilities; and
- 170 person residential complex in Purovsk.
The number of plant operating personnel is determined based on the approved number of facilities, current normative documentation, similar projects and expert evaluation. A total of 340 workers will operate the Purovskiy plant . The plant will also create approximately 100 additional jobs in the service sector of the Purovsk and Tarko-Sale settlements located in close proximity to the plant.
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