Page 83 - RusRPTFeb22

9.0 Industry & Sectors 9.1 Sector news
9.1.1a Oil & gas sector results
CDU TEK has published Russia’s oil and gas production statistics for January 2022. Russian liquids production was up 0.9% m/m to 46.5mnt in absolute terms. In daily terms, it also increased 0.9% m/m to 10.96mnbbl/d. Among integrated oil companies, Bashneft showed the highest m/m growth in liquids daily output of 8.7%, followed by Surgutneftegas, with 2%. Rosneft increased daily production 0.5% m/m. Tatneft’s daily output was flat m/m. Lukoil’s and Gazprom Neft’s daily production figures were down a slight 0.1% m/m and 0.3% m/m, respectively. Non-integrated companies increased liquids production 1.1% m/m in daily terms to 3.03mnbbl/d.
Russia’s gas output was up 1.1% y/y in January to 69.4bcm. Gazprom increased production 1% y/y to 47.4bcm. Novatek’s standalone production slightly decreased 0.7% y/y. Yamal LNG’s gas production grew 8.1% y/y, Terneftegas’s 5.9% y/y and Arcticgas’s 0.2% y/y, while Nortgas showed a decline of 11.9% y/y. Novatek’s consolidated production was down 2.3% y/y. Rosneft’s gas production increased 7.1% y/y. At Surgutneftegas, production fell 2.8% y/y, while at Lukoil it was down 4.0% y/y.
In January, OPEC+ production grew an additional 400kbbl/d monthly, while Russia’s quota increased 100kbbl/d monthly. The data on the production of gas condensate in January in the country is not available yet. If we assume it at 111.5kt/d (December’s level), then the production of oil in January could have been some 10.1mmbbl/d, which would be in line with Russia’s OPEC+ quota of 10.1mnbbl/d. However, we suppose that Russian oil companies are unlikely to be able to reach their quotas in accordance with the increasing OPEC+ schedule and deliver production of 10.4mnbbl/d of crude oil by May in the framework of their earlier articulated capex plans (see our Russian Oils – Barrels..., of 27 January 2022). We estimate that crude production will only recover to the OPEC+ target by the end of the year (10.2mnbbl/d in 2022F on average, up 6% y/y). However, this implies only an insignificant effect on valuations, while the sector’s 2022F EBITDA might be 0-1% lower as a result of a slower production recovery, we estimate (all else being equal).
Gazprom was producing at 1.57bcm/d in January, which we think is close to its maximum available capacity. The company highlighted the increased gas demand in Russia, which was the key driver for the growth. In export, Gazprom delivered about 10.5bcm to Europe, down 43% y/y (but still slightly higher than the historical record low of January 2009). The company continued to fulfil its contract obligations to European customers, and is likely to increase deliveries
83 RUSSIA Country Report February 2022 www.intellinews.com