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  • Volga Gas: Production & Drilling Update Report for October 2020

    Volga Gas plc, the oil and gas exploration and production group operating in the Volga Region of Russia, is pleased to provide the following update on its average production volumes for October 2020.

    Production Report

    The average production in October 2020 was 3,680 barrels of oil equivalent per day (7.4% lower than September 2020). This decrease was driven by the temporary shut-in of well VM-4 (the main condensate producer on the VM field) pending installation of replacement parts for the downhole pump in the well. 

    Average production comprised:

    Oct 2020

    Average

    Sep 2020

    Average

    Jan-Oct 2020

    Average

    Gas:

    9.1 mmcfd

    9.1 mmcfd

    8.8 mmcfd

    Condensate

    1,442 bpd

    1,664 bpd

    1,564 bpd

    Oil

    494 bpd

    579 bpd

    501 bpd

    LPG

    227 bpd

    220 bpd

    185 bpd

    Total

    3,680 boepd

    3,976 boepd

    3,713 boepd

    Production data is based preliminary on monthly production reports prepared for submissions to the tax authorities for Mineral Extraction Tax purposes. Final monthly production reports may vary marginally from preliminary monthly production reports.

    As at 31 October 2020, the Group held cash balances of US$10.9 million, and has no debt.

    Pricing update

    Domestic pricing for oil was slightly increased in RUR, whereas for condensate it was slightly lower. The LPG price decreased as is normal for winter seasons, although shortages in local supplies kept the LPG price higher than normally expected. Average pricing was:

    Pricing ex VAT, USD

    Oct 2020

    Average

    Sep 2020

    Average

    Jan-Oct 2020

    Average

    Exchange Rate (RUR/USD)

    77.5924

    75.6621

    71.4704

    Gas price per mcf

    1.67

    1.71

    1.81

    Condensate price per bbl

    24.26

    24.94

    26.33

    Oil price per bbl

    32.37

    32.14

    31.69

    LPG price per bbl

    29.68

    33.93

    27.02

     Novo Kurilovskiy prospect update

    Further to the announcement of 6 October 2020, testing operations have started at the Novo Kurilovskiy prospect. The formation will be tested by several perforation intervals in order to gather detailed information about the saturation and reservoir properties. The Group anticipates to complete the testing programme by the end of 2020. 

    Market Abuse Regulation (MAR) Disclosure

    Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.

    For further information, please contact:

     

    Volga Gas plc

    Andrey Zozulya, Chief Executive Officer

    Vadim Son, Chief Financial Officer

    Tony Alves, Investor Relations Consultant

    +7 (903) 385 9889

    +7 (905) 381 4377

    +44 (0) 7824 884 342

    S.P. Angel Corporate Finance LLP

    +44 (0) 20 3470 0470

    Richard Morrison, Richard Hail, Adam Cowl   

    FTI Consulting

    +44 (0) 20 3727 1000

    Alex Beagley, Fern Duncan

    Notes 

    The information contained in this announcement has been reviewed and verified by Mr. Andrey Zozulya, Chief Executive Officer of Volga Gas plc, for the purposes of the Guidance Note for Mining, Oil and Gas companies issued by the London Stock Exchange in June 2009. Mr. Andrey Zozulya holds a degree in Geophysics and Engineering from the Groznensky Oil & Gas Institute and is a member of the Society of Petroleum Engineers.

    The Company records production in metric tonnes (for oil and condensate) and in cubic meters (for gas).  Conversions from metric to standard oil field units are used for illustrative purposes only and are based on the Company’s estimate of the applicable ratios.  The ratios used are 7.833 barrels per tonne for oil and 8.75 barrels per tonne for condensate and 11.735 barrels per tonne for LPG. Gas volumes are translated using 35.3 cubic feet per cubic meter and 6,000 cubic feet per barrel of oil equivalent.

    Glossary

    bpd             Barrels per day

    boepd         Barrels of oil equivalent per day

    mmcfd        Millions of standard cubic feet per day 

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