Rosneft acquires assets in Khanty-Mansiysk Autonomous District for $700 million

MOSCOW -- Rosneft closed the acquisition of a 100% stake in the Kondaneft project, which is developing the Kondinsky, Zapadno-Erginsky, Chaprovsky and Novo-Endyrsky license areas in the Khanty-Mansiysk Autonomous District.

Acquisition of this asset is in line with the Company's strategy aimed at maximal efficiency of resource development in the main oil and gas producing region of the Company’s operations, which has developed infrastructure. The reserves of the Kondinsky group of fields (2R) stand at 157 MMt of oil according to the international reserves audit conducted by DeGolyer and MacNaughton. The company will take measures to commission the Kondaneft fields already in 2017, which will enable a significant increase in Rosneft's consolidated production indicators.

The Kondaneft group of fields is located 100 km from one of the Company's key assets, Priobskoye field, and is adjacent to Erginskoye, the largest field in the unallocated stock of the Russian Federation. An integrated approach to the development of the Kondinskoye group of fields and Erginskoye field will generate high synergy and accelerated development of the resource potential of the fields, considering the infrastructure already created within the Kondaneft project, as well as RN-Yuganskneftegaz' existing resources and the developed infrastructure. The start of production in the Kondaneft project in 2017 will launch the development of one of the most promising production clusters in the Russian oil and gas industry.

The acquisition price of 100% of the project company’s equity capital will be about 40 billion rubles (U.S. $700 million) and the cost of acquisition per barrel of reserves will be about U.S. $1/bbl. The deal received the necessary approvals from the Federal Antimonopoly Service of the Russian Federation.