TNK-BP: Curbs Keeping Gas Output Down

APAn operator working in the control room at Gazprom's headquarters Tuesday as gas began flowing to Europe again.
TNK-BP said natural gas production is below expectations because of Gazprom-imposed curbs.

Gazprom resumed gas pumping to Europe via Ukraine on Tuesday, ending almost two weeks of supply disruptions because of a price dispute. Domestic gas demand has declined because of the economic slowdown, Gazprom deputy CEO Alexander Medvedev said.

"Gas production is below plan because of the off-take by Gazprom," Tim Summers, TNK-BP's chief operating officer, said Tuesday.

He declined to specify volumes sold and why Gazprom is taking less gas. "Our oil production is on plan, in fact, it's very slightly ahead of our plan."

Ukraine's extended delays in purchasing gas from Gazprom may force the Russian company to reduce extraction because it is committed to buying the fuel from Turkmenistan, Dmitry Loukashov, an analyst at UBS, wrote in an e-mailed report Tuesday.

"We are performing in accordance with contracts signed," Medvedev said on a conference call with reporters. Independent producers and oil companies should recognize that demand is being affected by slower economic growth, he said.

TNK-BP "is performing as normal," while BP and Russian investors, the firm's shareholders, pursue talks on finding a new CEO, said Summers. He has been acting CEO since Dec. 1, after the departure of Robert Dudley.

"The management team and the company are focused very clearly on dealing with the challenges of the external environment at the moment," Summers said. "The shareholders are in the process of selecting a new chief executive," and "in the meantime we continue to operate."