Page 11 - FSUOGM Week 36 2021

FSUOGM POLICY FSUOGM

Russia looks to encourage

exploration in remote areas

RUSSIA RUSSIA’S government is looking at legislative support for exploration, the ministry also rec-
ways of encouraging geological exploration by ognises that many subsoil users have violated
Major oil, gas and reducing operators’ risks, the Moscow-based the terms of their licences. It plans to undertake
mineral discoveries in Kommersant newspaper reported on Septem- checks at 9,379 licences, including 3,931 licences
Russia have mostly ber 2. for hydrocarbons.
been made in remote In recent years, major oil, gas and mineral Russian operators are also under pressure to
and difficult-to-operate discoveries in Russia have mostly been made restore oil production after making drastic cuts
locations in recent in remote and difficult-to-operate-in locations, last year as part of the OPEC+ pact. According
years. such as the Arctic, driving up costs. Russian to energy ministry data, the country’s oil and gas
operators have also had to rein in spending fol- condensate production declined 8.6% last year
lowing the coronavirus (COVID-19) induced to 512.7mn tonnes (10.3mn barrels per day) in
oil market collapse, further constraining explo- 2020, while the vaalue of gas output dropped
ration activity. 6.2% to RUB692.3bn.
Exploration spending rose in 2020 to Encouraged by rising oil prices, the OPEC+
RUB340bn ($4.7bn), despite weak market con- group has agreed to restore 400,000 bpd of oil
ditions, as most plans had been approved before supply each month for the rest of this year. Rus-
the crisis. However, the Natural Resources sian Deputy Prime Minister Alexander Novak
Ministry predicts that investment will fall to said last week that national oil production should
RUB300bn this year. Spending on exploration rebound to its pre-crisis level by May next year if
from the state budget is due to fall by 11.4% to this policy is followed. Russia alone is permitted
RUB11.9bn. to bring back 100,000 bpd of production each
At the same time as considering additional month during the rest of the year. ™

Week 36 08•September•2021 www. NEWSBASE .com P11