Gazprom Neft commences first sea transportation from the Novy Port field

21 August 2014

Gazprom Neft has made a summer shipment of oil from the Novy Port oil field, with crude oil being delivered to European consumers by sea for the first time. This new type of crude, known as Novy Port, has all the characteristics of light crude, while its low sulphur content of approximately 0.1% is better than both the Urals Russian mixture and Brent. A sea tanker will deliver the oil to Europe in September and over 80,000 tonnes of the new Novy Port oil classification are scheduled to be delivered from the field by two tankers during the 2014 ice-free season.

The Novy Port field is one of the largest oil and gas condensate deposits being developed in the Yamalo-Nenets Autonomous Area (YNAO). Based on the Yamal peninsula, the deposit is located far away from existing pipeline infrastructure. To address this matter, year-round transportation of oil from the Novy Port will be conducted by sea. Gazprom Neft confirmed the viability of this plan in 2011 after a test voyage by a nuclear-powered icebreaker from the Sabetta port (north east of the Yamal peninsula) to Cape Kamenny some 400km to the south. A terminal with daily capacity of up to 40,000 tonnes of crude will be built at Cape Kamenny at the end of 2015 to facilitate year-round transhipment of oil. On a temporary basis, until the terminal is built, oil will be transported by sea during the summer and using roads during the winter to deliver the oil to Payuta rail station. Gazprom Neft has been using winter roads for the last two seasons since 2013 but so far crude has only been delivered to Russian consumers.

A modern laboratory with the equipment necessary to perform high quality chemical analysis and research has been commissioned at the Novy Port field for the purposes of quality control. Crude oil from the Novy Port deposit is being delivered to Cape Kamenny via the first part of a newly laid<nobr>103-kilometre</nobr> pipeline with a capacity of 600,000 tonnes annually. From there, river tankers will carry crude oil to an anchored ice-class sea tanker. Equipment used for crude transfer is certified by the Russian Maritime Register of Shipping, the Russian River Register, Rostekhnadzor and other supervisory body approvals. The project for temporary summer shipping of oil to sea tankers passed environmental testing and was approved at public hearings in March 2014.

Industrial facilities were built in line with leading international standards and make use of solutions that help to minimise environmental impact and to ensure reliable performance in difficult weather conditions. The oil pipeline was built using construction methods deployed for similar projects in countries with a similar climate to the Russian Far North. The pipeline is held above the ground by pillars, which helps to protect against the effect of permafrost. Special crossings and passages have also been built in deer migration areas. The pipeline is equipped with heating, continuous integrity and condition monitoring systems.

Shipping partners include Sovcomflot, which has provided two modern ice-class tankers to deliver the crude to consumers.

Alexander Dyukov, Gazprom Neft’s Chairman of the Management Board, stated: “Developing on-shore and off-shore fields in the Far North is a key priority in Gazprom Neft’s long term development strategy. We have been working on creating a new production cluster in the north of the YNAO for several years. A bespoke approach is employed in complex and capital-intensive projects to address lack of infrastructure and severe weather conditions. These deposits will soon become a growth source and will make a massive contribution towards achieving Gazprom Neft’s production target of 100 million tonnes of oil equivalent per year. The first summer shipment of Novy Port oil sees the opening of a new transportation route, by sea. The experience we gain on this route will help us to achieve our plans and begin full-scale year-round development of the Novy Port field in 2016.”