Operating results

Vostok Oil – a large-scale world-class project

Vostok Oil

In compliance with the Russian President's instruction to increase the cargo flow along the Northern Sea Route, the Company continues comprehensive development of the new oil and gas province in the Krasnoyarsk Territory’s north as part of the Vostok Oil project.

The project is implemented at the existing fields of the Vankor cluster, the Payakhskoye field and licence areas prepared for development, the newly discovered Zapadno-Irkinskoye field, and the Company's exploration licences on the Taimyr Peninsula. Investment incentives for infrastructure facilitated the economic model’s efficiency and allowed Rosneft to begin project implementation.

>500 mmt of oil
and 138 bcm of С1 + С2 gas – recoverable reserves of the Zapadno-Irkinskoye field discovered in 2020
Project highlights
  • Proven world-class resource base of 6 bt of liquid hydrocarbons.
  • 50 licence areas within the project perimeter.
  • The light (40°API) and low-sulphur (<0.05%) oil has a better quality than Brent and ESPO crude grades.
  • Expected cargo traffic along the Northern Sea Route: up to 30 mmt in 2024, up to 50 mmt in 2027, and up to 100 mmt in 2030
  • An international partner (Trafigura) joined the project.
  • Low carbon footprint (12 kg/boe) – 25% of large oil projects’ standard indicators.
Infrastructure development
  • 15 shift camps, several heliports and airfields, oil loading terminal with an annual capacity of 100 mmt.
  • 770 km of trunk pipelines and 7,000 km of infield pipelines.
  • Power units with a total capacity of 2.5 GW, including wind power generation, more than 3.5 thousand km of power transmission lines.
  • 50 vessels of various classes, including 10 advanced ice-class tankers with a deadweight of 120 kt.
Project's competitive edge
  • The synergy effect due to the proximity of extensive infrastructure and expertise gained during the development of the Vankor cluster fields will significantly reduce the time to complete and enhance efficiency of the project.
  • The proximity of the project fields to the unique Northern Sea Route will help procure top quality feedstock (light sweet crude) and a price with a premium to the Brent grade.
  • Vostok Oil's synergy with the Zvezda hi-tech shipyard project in the Far East, where Rosneft is one of the shareholders and anchor customer (the project will require up to 50 Arc7 ice-class tankers), will also enhance the efficiency metrics.
Investment incentives
  • Infrastructure financing through reduced MET rate imposed on the existing producing fields of the Vankor cluster included in Vostok Oil.
  • Zero MET rate for oil until the expiration of 16 years from the year when 1% depletion is achieved for new fields of the project.
  • Regional tax incentives: reduced income and property tax rates for existing and new project assets.
  • Gradual increase in the tax burden after the return on investment is achieved.

As a result of 2020 exploration activities, the Company discovered a large Zapadno-Irkinskoye field with recoverable C1 + C2 reserves comprising over 500 mmt of oil and 138 bcm of dissolved gas. The Zapadno-Irkinskoye field and the Payakhskoye field are similar in geological structure and form a single oil accumulation zone with unique reserves, which will be developed by implementing a unified approach to exploration planning and selection of development technologies.

The project has entered an active phase of design, engineering and survey and land management works. Sites for priority well pads for production drilling, as well as areas for oil gathering, treatment and pumping facilities, for auxiliary infrastructure (facilities for unloading and material and equipment storage, shift camps, aviation infrastructure, etc.) were selected. The design of the first phase is nearing completion and the design of the second phase of the trunk oil pipeline from Payakha MPS 1 to the Sever Bay MS, oil loading terminal and Sever Bay port, has started. Some projects have been submitted to state expert review, and land use documents are being prepared. The first phase facilities will allow transportation and transhipment of up to 30 mmt of oil per year from 2024. The second phase will expand capacity to 100 mmt of oil per year.