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Gazprom Neft thirst for oil shows Russian dilemma on OPEC pact

Gasoil News - Published on Fri, 30 Nov 2018

Image Source: Reuters India
Reuters reported that in the green to golden steppe some 1,500 km east of Moscow, a unit of Gazprom Neft, Russia's third-biggest oil producer, is drilling hard as it eyes a production hike of 20 percent a year, developing once-forgotten and depleted fields. That thirst for growth, a cornerstone of Gazprom Neft's plans to increase its oil production by 8 percent to 100 million tonnes (2 million barrels per day) in 2020, shows the struggle Moscow faces in adhering to a global deal on oil output.

Sources said that Next week in Vienna, OPEC and non-OPEC producers, led by Saudi Arabia and Russia respectively, will discuss whether - and by how much - their joint output could be curbed to prop up oil prices. Moscow opposes any new cuts.

Such a decision would mark a policy U-turn after the partners agreed in June to raise global production. It would also hurt Russian oil firms, which want to boost their output.

Gazprom Neft Orenburg, in Russia's southern Urals region close to Kazakhstan, illustrates the trend in the Russian oil industry, which is pinning its hopes for growth on remote locations, hard-to-extract oil and areas such as the Arctic.

Gazprom Neft Orenburg has tripled its oil production in the past five years and plans to produce 2.7 million tonnes in 2018 a level close to that of its Prirazlomnoye oilfield in the Arctic Barents Sea, the only such project in Russia.

Mr Irek Khabipov, the head of Gazprom Neft Orenburg, told reporters in his office that "We see annual growth of 20 percent in the next three years.”

For now, the Orenburg cluster accounts for around 4.5 percent of Gazprom Neft's oil output and is set to take a share of 8 percent by 2022, according to Andrey Voropayev, head of oil production at Gazprom Neft.

He was promoted to his post this year after heading Gazprom Neft Orenburg for three years from 2015.

Source :

Posted By : Joykumar Irom on Fri, 30 Nov 2018
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