Surgut Reports 15% Rise in Net Profit

The country's fourth-largest oil firm, Surgutneftegaz, reported a 15 percent rise in net profit in 2007, despite falling oil production, and said on Monday it would increase its dividend by 14 percent.

The company said in a statement that its profit under Russian accounting standards rose to 88.63 billion rubles, about $3.8 billion, from 77.1 billion rubles a year earlier.

Surgut also said its board had recommended a dividend of 60 kopeks per ordinary share and 82 kopeks per preferred share, bringing the total payout to 27.75 billion rubles, a 14 percent increase from the previous year.

Surgut is a subject of regular speculation, with some investors expecting its $15 billion cash reserve and strength in the greenfield region of eastern Siberia will yield huge profits in the future.

Others suspect the company will be caught up in the Kremlin's drive to increase state control over the energy sector.