Surgutneftegas Wins Two Exploration Licenses

In 2002 Surgutneftegas obtained 5 licenses to use subsurface resources including two licenses for possible prospecting and production of oil and gas at Severo-Labatyugansky and Severo-Yuryevsky areas with recoverable reserves of 14.1 and 5.4 million tons of C1 and C2 oil respectively. The remaining three geological examination licenses were obtained by the Company to explore and examine hydrocarbon fields at Novo-Nadymsky (southern part), Yuzhno-Lyaminsky and Verkhne-Semiegansky areas.

In early February of 2003 the RF Ministry of Nature granted OJSC "Surgutneftegas" the right for geological examination of Yuzhno-Galyanovsky and Lungorsky prospects with total area of 3,800 sq km. The license terms provide for 12 exploratory wells and minimum of 6,500 line km of seismic operations to be performed by the Company within next five years.

Except for Verkhne-Semiegansky license area, located in Yamalo-Nenetsky Autonomous Okrug, all the recently acquired license areas belong to Khanty-Mansiysky Autonomous Okrug.

To choose a company for seismic survey at new sites from 2003 to 2004 Surgutneftegas is planning to call for a tender this year. The Company's Exploration and Prospecting Division is to start operations at Yuzhno-Galyanovsky and Lungorsky prospects in 2004.

The Company keeps on increasing its resource base. The year 2002 saw 285,000 m of discovery wells and 42 million tons of additional commercial oil reserves. Surgutneftegas started exploration works at Rogozhnikovsky area with first three wells drilled last year and seven wells scheduled for the present year.