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| Project sponsor and major shareholders of project company |
| The project is sponsored by YNG’s parent, OAO Novatek (Novatek or the sponsor), the largest, privately-owned independent gas producer in Russia with a total of approximately 13.2 bcm of production in 2003 attributable to its working interests in subsidiaries and associates. Novatek has several lines of business, including gas, condensate, and oil production, construction, pipe insulation, and others. The sponsor’s producing assets are in Russia’s main gas producing region, Nadym-Pur-Taz, part of the Yamalo-Nenets Autonomous Region of Western Siberia. Its three largest fields collectively have 574 bcm (20 Tcf) of gas reserves, 33 mmt (268 mmbbls) of condensate and 8 mmt (59 mmbbls) of oil in proved reserves. Novatek is striving to maintain its lead as the largest independent gas producer in Russia, while expanding into refining and transportation of gas condensate and refined products. The project company, YNG, is a wholly-owned subsidiary of Novatek. |
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| Total project cost and proposed IFC investment |
| The total project cost is estimated at about $282 million. IFC’s investment is up to $80 million for its own account, and a possible $70 million syndicated B Loan. |
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| Location of project and description of site |
| The western part of the Yurkharovskoye field lies on the Tazov Peninsula, while the central and eastern parts of the field are situated on the shelf of the Tazov Bay where water depths average 4 meters. Administratively, the current YNG operations fall into the Nadym raion or municipality. Some of the company’s exploration area falls into the Tazovsk municipality, and the closest communities are Nakhodka, located 20 kilometers from the field, and Tazovsk, located 60 kilometers from the field. |
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| Description of company and purpose of project |
Independent Russian gas producer OAO Novatek (the sponsor) has requested IFC assistance in the staged expansion of a large natural gas and condensate field in the Yamalo-Nenets Autonomous Region of Russia’s Arctic Circle. The Yurkharov Gas Field is operated by OOO Yurkharovneftegaz (YNG or the company), a wholly owned subsidiary of OAO Novatek. Discovered in 1970 by a Gazprom-affiliated exploration company of the Soviet era, the field was deemed too small for Gazprom’s development threshold. OOO Yurkharovneftegas was formed in July 1998, and YNG’s existing ownership structure was put in place in October 1999. Production at YNG commenced in January 2003 with 3.115 bcm of gas produced that year. Gas production is expected to reach 9 bcm/y by the end of 2006.
YNG operates the Yurkharovskoe field (approximately 200 sq. km.), which has 208 billion cubic meters (bcm) (7.4 trillion cubic feet (tcf)) of gas and 106 million barrels (mmbbls) of condensate. The IFC-funded project is to increase YNG’s production of gas to 9 bcm/y (Phase I). Two subsequent phases will increase production to 18 bcm/y and to 27 bcm/y. The company’s production will be transported through the region’s extensive gas and liquids infrastructure to industrial consumers and gas traders in the domestic market. |
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| Environmental and social issues - Category B |
This is a Category B project according to IFC’s Procedure for Environmental and Social Review of Projects because a limited number of specific social and environmental impacts may result that can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. The review of this project consisted of appraising technical, social, and environmental information submitted by the project sponsor and field visits by IFC specialists. The following potential social, environment, health and safety impacts of the projects were analyzed:
- Prior land use;
- Indigenous peoples;
- Worker health and safety;
- Gas field transport, construction and operation in permafrosted and ice-covered areas;
- Hazardous waste management;
- Liquid and solid waste management;
- Air emissions;
- Emergency response plans;
- Development of an integrated environment, health and safety management system; and
- Reclamation and closure.
The Sponsor has presented plans to address these impacts to ensure that the proposed project will, upon implementation of the specific agreed measures, comply with the environmental and social requirements; the host country laws and regulations; the World Bank/IFC environment and social policies; and the WBG/IFC environmental, health and safety guidelines. The information about how the Sponsor will address these potential impacts is detailed in the Environmental Review Summary (ERS) disclosed in the World Bank InfoShop and in the locations described below.
To view the environmental documents for this project, click here
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| Location of environmental documents in locally affected community |
The Sponsor has placed announcements in newspapers in the locally affected communities describing where the Environmental Review Summary and Indigenous Peoples Plan may be viewed. The announcements were published on October 14, 2004 in the following local newspapers:
- Noviy Urengoi, Russia - Newspaper “Urengoi Weekly”
- Tazovskiy Settlement, Russia - Newspaper ‘Sovietskoye Zapolyarnoye”
- Nadym, Russia - Newspaper “Nadym Worker’
The viewing locations of the Environmental Review Summary and the Indigenous Peoples Plan announced in the above newspapers are as follows:
- Noviy Urengoi, Zhurnal Smena Library, 3a Molodyozhnaya St., Noviy Urengoi, Russia
- Tazovskiy Settlement, Central Tazovskiy Regional Library, 34 Pietomina St., Tazovskiy Settlement, Russia
- Nadym, Central Town Library, 10 Leningradskiy St., Nadym , Russia
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| To contact the project company, please write to: |
Yurkharovneftegas
P.O Box 1043
Noviy Urengoi,
Russia 626300
Phone: (34949) 7-40-51
Fax: (34949) 7-40-52 |