Page 14 - FSUOGM Week 38 2019

FSUOGM PROJECTS & COMPANIES FSUOGM
Surgut launches new East Siberian field
RUSSIA
Surgut entered Eastern Siberia in 2003.
RUSSIA’S privately run Surgutneftegaz (Surgut) has commissioned a new oilfield in the Yakutia region of Eastern Siberia, it said on September 21.
The Lenskoye field, containing some 40mn tonnes (293.2mn barrels) of proven oil, is one of Surgut’s Talakan fields, consisting of the main Talakanskoye deposit and several satellites. SNG did not reveal the field’s target output.
Talakanskoye was among the first fields to be developed in Eastern Siberia, having come on stream in 1989. Production remained at a low level until the completion of the Eastern Sibe- ria – Pacific Ocean (ESPO) pipeline in 2009. ESPO pumps oil from Eastern Siberia directly to China and also to Far Eastern ports, where it can be loaded onto tankers for sale to Asia-Pacific markets.
Surgut is Russia’s fourth largest oil producer, though its owners are unknown. The company has been accumulating cash over the years, with its stockpile reaching $52bn at the end of June. It share price spiked this month after it revealed it had set up a new securities unit, Rion, raising
hopes it would start investing some of these funds.
The company reported a net IFRS loss of $238mn for the first half, largely because of an adjustment of its mostly US dollar-denominated cash reserves to take into account currency fluctuations.
Surgut’s main base of operations is in the Surgutsky district of Western Siberia. It entered Eastern Siberia in 2003, when it assumed con- trol of the Talakanskoye field. In its statement, the company said it now controlled seven fields in the area, along with 25 exploration blocks in Yakutia, Irkutsk and Krasnoyarsk. It aims to ramp up its Eastern Siberian production to 9.3mn tonnes (187,000 barrels per day) in 2019, equal to 15% of its total output and up from 183,000 bpd last year.
The company is set to drill more than 55,000 metres of exploration wells in Eastern Siberia this year, accounting for 23% of its total drilling. It said it had invested RUB289.5bn ($4.5bn) in Eastern Siberia in the past 15 years, with spend- ing set to reach RUB25.5bn this year.™
RUSSIA
Rosneft to invest $850mn in Indian Vadinar refinery
Russia’s largest crude oil producer
Rosneft and a consortium of investors
are considering an investment of $850mn over two years in upgrading the Indian Vadinar refinery, Reuters reported citing the announcement by the company.
Rosneft also reportedly intends to expand the presence of Nayara Energy (controls Vadinar) in the retail sector. The company in which Rosneft holds 49.13% currently operates 5,300 petrol stations in India.
The announcement is out of line with Rosneft last year pledge to investors to scale back large foreign investments.
In the meantime Rosneft’s initiative could be part of a larger dive to improve cooperation between Russia and India
in the oil sector. The Minister of Oil Dharmendra Prahdan told Reuters in
a separate report that India considers increasing imports of Russian oil, while four
NEWS IN BRIEF
Indian oil majors plan higher investment in Rosneft’s extraction assets Vostok Oil (based on Vankor field cluster).
Previous reports claimed that Rosneft was putting its Iranian projects on hold, as Nayara Energy, one of India’s biggest buyers of Iranian oil, began cutting its imports in 2018.
bne IntelliNews, September 19 2019
Russian government values oil reserves at $1 trillion
Russia’s Ministry of Natural Resources and Environment has estimated the total value
of Russia’s oil reserves at RUB74.5 trillion ($1.2 trillion), almost doubling the valuation over one year, RBC business portal reported. Total value of hydrocarbons, gold, diamonds, copper, and iron ore is estimated at RUB93.4 trillion ($1.5 trillion).
Previously the ministry put the value of oil reserves at the end of 2017 at RUB39.6 trillion. The reserves of natural gas were valued at RUB11.3 trillion, and coking coal at RUB2 trillion.
RBC notes that in volume terms the discovered reserves grew by only 8.7% to 9.83mn tonnes of oil equivalent, making a 73% year-on-year surge in monetary value, which is not clearly justified in ministry’s methodology. In US dollar terms oil reserves valuation increased by $385bn to $1.07 trillion.
The business portal also reminds that
the ministry accounts for all reserves, not only those that are commercially extractible. Experts surveyed by RBC criticise the pricing methodology for its treatment of tax, calculating based on the sales price, and not the netback, and basing the valuation on heterogeneous data of oil producers themselves.
The ministry’s valuation sees cost of lifting Russian oil at about RUB1,000 per barrel or $15.5 at current USD/RUB exchange rate, which is in line with previous government’s estimates of $8-20 per barrel.
The value of gas reserves increased to RUB14 trillion, of gold to RUB614bn, of iron ore to RUB1.2 trillion, of diamonds to RUB546bn.
bne IntelliNews, September 20 2019
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Week 38 25•September•2019