By the OGJ Online Staff
LONDON, Jan. 10 -- OAO Sibneft had the fastest rate of production growth of any major Russian oil company last year and has announced increased production targets for 2002.
Because it is one of the oil companies that recently agreed to cut output to support the Organization of Petroleum Exporting Countries' (OPEC) efforts to bolster oil prices, oil traders on the London International Petroleum Exchange interpreted the move as putting pressure on the Russia-OPEC pact.
Brent crude for February delivery fell 16¢ (0.8%) to $20.73/bbl in London. Prices have fallen18% in the past year.
Sibneft said that this year it aims to grow production at an even faster rate, with output targeted to rise by 26.3% to 516,000 b/d. The output increases are being driven by a dual strategy of intensive investment in developing new fields and in raising productivity at existing fields.
Most of Russia's oil companies have announced expansion plans for the coming year, but none are as ambitious as Sibneft's. Oil analysts say the company is likely to meet its targets.
The company plans to invest $600 million in production projects this year. It recently completed the acquisition of a 35% stake in the 242,995-b/d Moscow refinery and a 14.95% stake in OAO Mosnefteprodukt, both owned by OAO Central Fuel Co., which is in turn owned by the Moscow city government. Sibneft bought the assets from OAO Lukoil, Russia's largest oil company.
Nick Halliwell of Sibneft said Thursday that the new oil will be sold domestically, and Russia will continue to comply with its pledge to OPEC to curtail exports.
He said, "We do not see any conflict between the Russian government decision to cut exports and our production plans. We have a strong domestic business, and our margins are higher on oil products sales domestically than on crude exports. We plan to expand domestic marketing. Sibneft's investment strategy focuses on the development of new fields in West Siberia while also maintaining output at existing deposits."
In a statement Thursday, Sibneft said its 2001 output rose 20.2% over 2000 to 408,000 b/d. Sibneft last year began production for the first time at fields outside its core region of Noyabrsk. The production data includes output from Sibneft-Yugra and the company's Krapivinskoye field in the Omsk region.
Other operational highlights released by the Russian Energy Ministry show that in 2001 Sibneft's crude exports rose 30% to 143,000 b/d from 110,000 b/d. Average output of new wells rose 52% to 456 b/d. Average well productivity rose 14% to 98 b/d. Drilling footage rose 32% to 980,000 m. Fracturing operations rose 37% to 354.
The ministry said Sibneft's refining rose 6% to 262,000 b/d , with gasoline output of 3.237 million tonnes, diesel output of 4.525 million tonnes, fuel oil output of 1.962 million tonnes, and jet fuel output of 615,000 tonnes.
Sibneft said that this growth had been achieved while staffing fell by 22% to 29,300.
