KMG EP: Takes Reserve Hit – 1P Down 16%
JSC KаzМunaiGas Exploration Production announces today the results of the reserves audit as at 31 December 2014 performed by independent consultant Miller and Lents, Ltd. at the Ozenmunaigas JSC (“OMG”), Embamunaigas JSC (“EMG”) and Ural Oil and Gas LLP (“UOG” where KMG EP holds a 50% stake) fields.
According to the MLL report there were the following changes in liquid hydrocarbon reserves as at the end of 2014 compared to the reserves as at the end of 2013:
· Proved (1P) liquid hydrocarbon reserves are down by 16%, or 19 million tonnes, to 103 million tonnes (763 million barrels);
· Proved plus probable (2P) liquid hydrocarbon reserves are down by 11%, or 16 million tonnes, to 132 million tonnes (981 million barrels);
· Proved, probable plus possible (3P) liquid hydrocarbon reserves are down by 10%, or 18 million tonnes, to 164 million tonnes (1,215 million barrels).
The decrease in the liquid hydrocarbon reserves is primarily due to the decline in the crude oil and gas products price, partially offset by the devaluation of Tenge. The crude oil price decline was reflected primarily in the OMG fields as the 2P liquid hydrocarbon reserves decreased by 19.6% or 19.5 million tonnes. At the EMG fields, the 2P reserves of liquid hydrocarbons increased by 4.5% or 1.8 million tonnes due to enhanced actual production indicators as compared to the forecast made by MLL in 2013 reserves report which has had a positive effect on the outlook of those indicators. At the UOG (Rozhkovskoye field) there was a 16.4% or 1.3 million tonnes increase in 2P reserves as a consequence of the new deposits discovery in the Bashkirian horizon in 2014.
Assessment of 2P reserves of joint ventures were made separately by independent auditors1. KMG EP’s share in overall 2P reserves of Kazgermunai (KGM) (50% stake), CCEL (CCEL) (50% stake) and Petrokazakhstan Inc. (PKI) (33% stake) as at the end of 2014 amounted to 45 million tonnes (322 million barrels), which is 12% or 6 million tonnes less than in 2013. Therefore, consolidated 2P reserves of KMG EP including its stakes in KGM, CCEL, and PKI as at the end of 2014 amounted to 177 million tonnes (1,303 million barrels) which is 11% or 23 million tonnes less than in 2013.
