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. Last Updated: 07/27/2016

Oil, Gas Production Grows 7.7% in 2001

Fueled by cresting oil prices, Russian oil companies boosted output a combined 7.7 percent in 2001, beating the previous year-on-year increase of 6 percent.

Production of crude oil and gas condensate last year totaled 348.1 million tons, or about 7 million barrels per day, according to preliminary data supplied by sources close to the Energy Ministry, Reuters reported. In 2000, production topped off at 323.3 million tons, or 6.5 million bpd.

Exports also increased -- by 4 percent -- as sparks flew between Russia and the Organization of Petroleum Exporting Countries, which decided late last year to make any cuts in oil production dependant on the cooperation of major non-member exporters.

Russia's government and the cartel came to an agreement in December, and on Jan. 1, Russia implemented a 150,000 bpd reduction in exports whose aim is to stabilize the price of crude between $20 and $25 a barrel. By midday Tuesday in London, benchmark Brent crude was down 48 cents to $21.55.

Industry analysts say that such a drop in exports would have occurred anyway as the country begins to hoard more heating oil to combat plunging temperatures.

In the face of Russia's acquiescence, some oil companies have announced expansion programs that would increase production up to 20 percent in the coming year.

"Theoretically, though, the situation on the domestic market could change," said Gennady Krasovsky, an oil analyst at investment house NIKoil. "If Russia takes on the responsibility of curtailing exports, the supply will increase at home, pulling prices down. This could force companies to scale down their production."

Russia exported 133.5 million tons last year, compared to 128.3 million tons in 2000, according to the ministry's figures.

With no acquisitions in 2001, No. 6 Sibneft posted the highest rate of organic growth in total production at 19.8 percent. No. 4 Tyumen Oil Co., or TNK, saw the highest overall growth of 42.1 percent, much of which can be attributed to Chernogorneft's contribution to TNK's balance sheet. Chernogorneft is a Siberian oil operator that was at the center of an epic dispute between TNK and No. 11 Sidanko. It will eventually be transferred back to Sidanko under the terms of a resolution struck in August.

Other growth leaders included No. 8 Slavneft with a 21.7 percent year-on-year increase, No. 2 Yukos with 17.3 percent and No. 7 Rosneft with 10.9 percent. LUKoil maintained the top spot among producers, and its Russia-based output rose by a meager 1.2 percent while its overseas production soared by about 10 percent.

According to the figures, Gazprom entered the list at No. 10, which analysts attribute more to its gas condensate than crude oil production. Gazprom's appearance, however, underscores the gas giant's crusade to diversify production beyond just natural gas.

The United Financial Group brokerage estimates that Russia will produce more than 360 million tons, or 7.22 million bpd, in 2002.

NIKoil's Krasovsky's estimate is lower, at 355 million tons.

Fossil Fuel Giants

2001 Oil-Gas Output % Increase In Output Over 2000
1. LUKoil 62.916 1.2
2. Yukos 58.108 17.3
3. Surgut-neftegaz 44.028 8.4
4. TNK 40.607 42.1
5. Tatneft 24.612 1.1
6. Sibneft 20.593 19.8
7. Rosneft 14.942 10.9
8. Slavneft 14.923 21.7
9. Bashneft 11.864 -0.6
10. Gazprom 10.213 1.7

Output figures are from Russian operations only.