TNK-BP released the results of the independent audit of its reserves as at the end of 2008. This represents the sixth annual external audit of the company's reserves since its creation in August 2003.
The latest audit confirms that as of December 31st 2008, TNK-BP's Total Proved Reserves were 10.252 billion barrels of oil equivalent, applying PRMS (formerly SPE) criteria. This represents a Total Proved PRMS reserves replacement ratio of 146% in 2008.
Beyond the proved PRMS reserve additions, about 530 million barrels of non-proved oil reserves were added through exploration and appraisal activities, marking another successful year of resource renewal.
Under SEC methodology on a life of field (LOF) basis, TNK-BP's Total Proved Reserves were 8.112 billion barrels of oil equivalent. The addition of 494 million barrels of new Proved Reserves constitutes a Total Proved SEC (LOF) reserve replacement ratio of 82%. The average SEC LOF reserve replacement ratio over the past five years amounted to 133%. Strong underlying technical performance of the TNK-BP portfolio helped to mitigate the impacts of low year-end commodity prices. At the end of 2008 the spot price for the benchmark Dated Brent crude oil was $36.55 per barrel versus $96.37 per barrel at the end of 2007.
Tim Summers, Chief Executive Officer of TNK-BP, said, "In 2008, TNK-BP demonstrated remarkable performance despite external and internal challenges. The company's production continued to grow while the average SEC LOF reserve replacement ratio over the past five years amounted to 133% -- a world-class track record. We have a dedicated team and a resilient business structure which will help the company to meet the challenges of this year."
In 2008, total TNK-BP production of oil and gas increased by 2.6% which is significantly above a 0.3% rise of total Russian oil and gas production.
Francis Sommer, Executive Vice President Technology, TNK-BP, said, "The 2008 SEC LOF reserves replacement of 82% is a strong contribution to TNK-BP and Russia's reserves inventory. This is a very good result in light of the year-end price decline. It reflects the underlying strength of our base assets and the impact of applying efficient technologies. The waterflood and sidetracking activities started two years ago are now delivering visible results. The ramp-up of production from our Greenfields in 2009 will further underpin the company's reserves and production, despite the current, tough operating environment."
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