Operational summary 2019

As reported earlier in the fourth quarter of 2018 the Company successfully re-entered the old Soviet well #141 on the Aysky licence. Following the re-entry the well flowed a total of 150 barrels allowing the Company to file a reserve report for the newly discovered oil field. In 2019 we prepared the reserves report that was approved by the Russian State Reserves Committee. This resulted in 7.3 million barrels of recoverable AB1+B2 reserves of oil and a new production licence for the exploration and development of Aysky oil field received in July 2019. Test production in this new field commenced in August 2019.

We have successfully been working on slowing down the natural decline and stabilising production in the Ayazovskoye field, whilst further improving our understanding of our assets that has enabled us to prepare an exploration and development plan for the future.  At the same time, as an alternative strategy and as one of the options to maximise shareholder value we have been testing the market and have made some encouraging progress that may lead to more news in 2020.

The Komi assets, in spite of uneasy relationship on the corporate level, have produced some good operational results. In spite of the decline in Dinyu-Savinoborskoye field where production rapidly declined due to increased water cut in certain wells, the production from Yuzhno-Tebukskoye field was relatively stable, and the new drilling program in Sosnovskoye field (pad #3) demonstrated encouraging results. There are 7 more wells to be drilled in Sosnovskoye field by August 2020. The company has also continued the project to upgrade the Sosnovskoye field oil treatment facility including capacity expansion and new gas generation sets for both internal consumption and market sales.

Pavel Tetyakov, CEO of Petrosibir, comments: “I am very pleased with the positive results achieved by our team in 2019. With modest capital investments we have been able to maintain stable production levels at the same time as placing the new field in production. This is helping in our efforts to increase shareholder value in the future. Finally, since we are coming to the end of 2019, I would like thank our shareholders for continued support and wish you all Merry Christmas and Happy New Year!”