Naryanmarneftegas (NMNG) is a Russian limited liability company established in 2005 between LUKOIL (70 percent) and ConocoPhillips (30 percent). The joint venture was established to develop and produce numerous large oil fields in the Nenets Okrug and export the production through a large marine terminal to be constructed at Varandey.
Naryanmarneftegas has oil reserves of approximately 173.5 million tons (SPE) with the largest field being Yuzhno-Khylchuyu (YK).
NMNG headquarter office is located in Naryan Mar and the staff is over 98 percent Russian nationals. In conjunction with the formation of the LUKOIL-ConocoPhillips Strategic Alliance, the companies announced the creation of a joint venture in 2005 on the basis of existing company Narianmarneftegas LLC with interests of 70 percent (LUKOIL) and 30 percent (ConocoPhillips).
On June 20, 2008, YK field was put into production. Maximum oil production level in the field is expected to reach 7.5 million tons a year (over 150,000 bbl/d). Costs for YK and Varandey Terminal projects are expected to total about $4 billion.
The oil is processed at a Central Processing Facility, which accommodates primary oil/gas/water separation. The processed oil production from the YK Field is transported via a 162 km pipeline to the Varandey terminal located northeast of the field for further loading into ice breaking tankers.
The Varandey terminal includes an onshore tank farm, two 24 km offshore pipelines to a loading structure located in 17.5 m depth of water. Varandey has the capacity to export up to 240,000 BOPD, much of which will come from the YK field. Three ice-resistant double-hull Arctic “Class 6” shuttle tankers, owned by Sovcomflot, [capacity: 500,000 barrels each] will be used for oil transportation. The terminal is operated by the 100%-owned LUKOIL subsidiary, Varandey Terminal Company.
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