Page 60 - RUSRptAug18

9.0 Industry & Sectors 9.1 Sector news
9.1.1 Oil & gas sector news
Russia's Ministry of Energy expects crude oil output in the country to grow almost 1% year-on-year in 2018 and 2019 to 551mn metric tonnes (mnt) and 555mnt, respectively , Kommersant daily reported on July 25 citing the Minister of Energy Alexander Novak. "This implies a 3.5mnt increase on the previous forecast for 2018 post Opec+ agreement to increase 2H18 production by 1mnbd [mn barrels daily]," VTB Capital estimated on July 26, Previously, Novak said that in the second half of 2018, Russian companies might increase output by 0.2mnbd, which is equivalent to 5mnt for January-June, making the ministry’s forecast conservative compared with the possible production increase in accordance with the latest Opec+ deal, the bank commented. As of mid-July Russia's crude oil output had already reached 11.2mnbd, according to Kommersant, almost at the record high levels of October 2016. This is in line with previous reports on an increase of oil output in June . In the first half of July Rosneft increased output by 0.1mnbd, Gazprom Neft by 0.055mnbd, and Lukoil by 0.027mnbd. According to Novak, by mid-July oil companies had recovered 80% of the oil production cut.
Russian gas giant Gazprom has increased gas production by 8.5% to 270.1bn cubic meters in the period from January 1 through to July 15, 2018 , the company said in its report, adding that its export to non-CIS countries has grown by 5.8% to reach 108.9bn cubic meters. In addition, the company reported 6.7% (by 1.1bn cubic meters) growth of gas production to 17.1bn cubic meters on July 1 - July 15, as compared to the same period of the preceding year. Gazprom’s sales on the domestic market through the state gas-supply network have gone up by 5.3% (by 7bn cubic meters) since the beginning of the year. In particular, the company reports hike in the gas export to Germany by 12.2% (by 3.5bn cubic meters), to Austria - by 52.3% (by 2.1bn cubic meters), to the Netherlands - by 61.9% (by 1.4bn cubic meters), to France - by 12.5% (by 0.8bn cubic meters), to Croatia - 45% (0.6bn cubic meters) and to Poland 6.7%. Shortly ago, Gazprom CEO Alexei Miller said that the company’s gas export to Europe may hit report high of 200bn cubic meters in the current year. Touching upon key factors for the gas demand growth, he mentioned an increase of the economic activity in European countries and long-term trend for the drop in Europe’s gas production, which formed in the recent years. In 2017, Gazprom raised gas production by 12.4% to 471bn cubic meters, as compared to 2016. This year, the company hopes for one-percent growth in gas production (to reach 476bn cubic meters). However, Gazprom does not rule out that the forecast may be reviewed and raised.
Russian giant Gazprom could start exports of natural gas to Bulgaria, Serbia and Hungary through Turkish Stream in 2020, its head Aleksey Miller said at a press conference to present the company’s 2017 financial results. At the end of May, Bulgaria’s Prime Minister Boyko Borissov announced that Russia will extend the Turkish Stream natural gas pipeline to
60 RUSSIA Country Report August 2018 www.intellinews.com