RussNeft, Salym Petroleum and Monolit launched in Khanty-Mansi Autonomous Okrug an LPG plant, the cost of the project amounts to 10 billion rubles

To realize this project SPD, Monolit and RussNeft signed a tripartite memorandum of understanding on APG utilization in 2008. Under this agreement the parties agreed to create necessary infrastructure to ensure integrated processing of associated petroleum gas produced at Salym group of oil fields /SPD/ and Shapsha group of oil fields /RussNeft/.
The total investment into this APG utilization project exceeds 10 bln rubles. Besides, international financial companies such as EBRD, DEG /Germany/ and UniCreditBank /Austriia/ took part in financing LPG plant construction.
Since the very start of the project SPD paid  key attention to gas utilization in Salym group. The company developed an extensive APG utilization program. This project included two stages:
construction and start-up of a 60MW gas turbine power plant (PGP) which since 2008 has used around 1/3 of the AGP to generate electric power; construction and operation at the territory of Salym of a compressor station and a pipeline for APG supply to the plant of Monolit.
“The LPG plant is a unique project of partnership between three companies and the government, and a genuine demonstration of the WIN-WIN principle.  – SPD CEO Simon Durkin said. – The project is not only important for the companies but for the region and for Russia as a whole. The project has multiple benefits, creating a new company, new jobs, reducing emissions to the environment and paying taxes to the government. Launching of the project demonstrates clearly what can be reached through mutually beneficial public private partnership in building reliable energetic future”
Development of Shapsha group of oilfields is an important strategic project for RussNeft. In 2010 at Nizhne-Shapshinskoye oilfield Monolit implemented  a unique project of construction and start-up of a gas piston power plant to provide the oilfield with own electric power and to increase the level of APG efficient use. In 2012 a compressor station is to be launched at Nizhne-Shapshinskoye oilfield, and a gas piston power plant – at Verkhne-Shapshinskoye oilfield. In June 2012 the Company plans to complete construction of gas infield pipeline  52 km long from compressor station at Verkhne-Shapshinskoye oilfield to one at Nizhne-Shapshinskoye oilfield.
 “RussNeft pays special attention to the realization of programs aiming at increasing the efficient use of APG, production of natural gas, gas processing and gas energy, – said Mikhail Gutseriev, President of RussNeft. – Launch of the LPG plant is a clear example of optimal engineering solutions, and it defines broad opportunities to utilize APG at the level of 95%, improves ecology in the oil fields, provide oil fields with electric power”.
“The LPG plant is an unprecedented facility for the Russian oil and gas industry that has no parallels in the country”, said the Monolit CEO Andrey Nepomnyaschy. “The plant, of block-modular construction with capacity of 360 million m3 per year, gets APG from SPD and RussNeft and processes it into dry stripped gas and propane-butane mixture which goes to the market. Thus APG is not flared but fully processed contributing into sustainable use of natural resources. As a result of the project implementation , a full APG processing cycle was created to ensure both energy efficiency growth and carbon emission reduction. Moreover, the new business model is created, which can be applied at other small and medium size oilfields”,.
SPD  is a 50/50 Joint Venture of Shell Salym Development B.V. (part of Shell group) and Gazprom Neft. Since 2003, SPD has been developing the Salym group of oilfields (Zapadny Salym, Verkhny Salym and Vadelyp), which are located in the Khanty-Mansi Autonomous Okrug in Western Siberia. Total recoverable resources are 140 mln. tones. The Salym Project is one of the largest on-shore investment projects with foreign capital in the Russian energy sector. In 2011, SPD produced over 8.4 million tons of oil.
OAO Oil and Gas Company RussNeft is a vertically – integrated oil holding numbered among top ten oil and gas enterprises of the country. NK RussNeft structure encompasses 24 upstream enterprises in  11 regions of Russia, the CIS and Western Africa. The head office of the company is in Moscow. Oil production output of the Company’s plants amounts to 13.6 million tons. Gas production output at  RussNeft plants amounts to 2.150 bln.m3. Net  effective pay of oil and condensate of Russneft exceeds 600 million tons. Gas net effective pay – 140 bln.m3.
OOO Monolit is a member of Roza Mira group of companies which was founded in 1991. The core business of the group is oil refining. OOO Monolit  is a specialized company for  managing construction and operation of associated petroleum gas processing facilities. The company is involved in a few associated petroleum gas projects in Khanty-Mansi Okrug. The total annual processing output f the company  makes more than 800 million cbm of APG. The total amount of investments  in the projects implemented by the company is USD 350 million.