Reserves and resources

In 2008 Rosneft confirmed its status as the biggest public oil company in the world by volume of liquid hydrocarbon reserves. The Company strives to replace and expand its reserve base efficiently to support accelerated production growth.

Despite significant fall in oil prices at the end of 2008 the Company increased its proved reserves under PRMS (previously SPE) classification, and achieved almost full reserve replacement under SEC classification.

According to an audit by DeGolyer & MacNaughton, Rosneft’s proved reserves by PRMS classification as of December 31, 2008 totaled 17,694 mln barrels of oil and 784 bln cubic meters of gas. The Company’s proved hydrocarbon reserves increased by 2.8% to 22,307 mln barrels of oil equivalent, mainly thanks to large-scale and highly efficient geological exploration work. The proved hydrocarbon reserve replacement ratio in 2008 was 172%, including 123% for oil reserves.

Company reserves are located both in traditional oil & gas producing regions (southern part of European Russia, Western Siberia, Central Russia) and in promising new regions (Eastern Siberia, the Far East, Timan Pechora). More than 77% of the Company’s proved oil reserves are concentrated in Western Siberia, mainly in Khanty-Mansiysk Autonomous District. About 10% of Company oil reserves are in Eastern Siberia. Western Siberia also contains about 80% of the Company’s proved gas reserves, which are concentrated mainly in the Yamal-Nenets Autonomous District. Most of Rosneft’s reserves are conventional. Hydrocarbon reserve life at the end of 2008 was 26 years (23 years for oil and 65 for gas).

The Company also has large probable and possible reserves, which provide an excellent foundation for further growth of proved reserves. Probable reserves by PRMS classification at the end of 2008 totaled 10,854 mln barrels of oil and 535 bln cubic meters of gas, with possible reserves of 9,675 mln barrels of oil and 505 bln cubic meters of gas.

Rosneft also audits its reserves under the SEC life-of-field classification. DeGolyer & MacNaughton’s audit as of December 31, 2008 found that the Company’s SEC proved reserves totaled 13,275 mln barrels of oil and 199 bln cubic meters of gas.

Rosneft actively participates in various exploration projects both in Russia and abroad. This enables the Company to efficiently replace extracted reserves and continuously expand its reserve base, which ensures sustainable growth in production. Rosneft performs regular audits of its prospective resources. According to DeGolyer & MacNaughton report, as of December 31, 2008, the mean estimate of prospective resources within upstream projects involving Rosneft was 37.1 bln barrels of oil and 2.7 tcm of gas.

Rosneft’s hydrocarbon reserves and resources audited by DeGolyer & MacNaughton, as of December 31

You can find detailed reserves data in the Analyst Databook.