Bloomberg News

Russian Crude Oil Production Rose to Post-Soviet High in 2011

January 03, 2012

Jan. 2 (Bloomberg) -- Russian oil production rose 1.25 percent in 2011 to a record level for the post-Soviet era, as companies in the world’s largest crude-producing nation took advantage of higher prices and boosted output at new projects.

Production grew to an average of 10.27 million barrels a day, according to preliminary data from the Energy Ministry’s CDU-TEK unit. Output in December slipped to 10.32 million barrels a day from 10.35 million in November, the data showed.

Prime Minister Vladimir Putin, who will seek re-election as president in March, has called for Russia to pump more than 10 million barrels a day for at least the next decade. Taxes on oil and exports are the biggest contributor to the national budget.

The average price for Urals crude, Russia’s benchmark grade, for delivery to Northwest Europe jumped 40 percent to $109.30 a barrel, according to data compiled by Bloomberg. Demand for Urals rose after the revolution in Libya halted crude exports from that nation and the Fukushima nuclear disaster in Japan led many countries to reconsider use of atomic energy.

Putin cut the tax rate on crude exports on Oct. 1 to spur investment in Russian oil fields and facilities. Production reached 10.35 million barrels a day that month and again in November, reaching its highest level since Soviet-era output peaked at 11.48 million barrels a day in 1987, according to data from BP Plc.

Vankor Field

OAO Rosneft, Russia’s biggest producer, raised average output from its Vankor field, one of the country’s largest, by 18.1 percent last year to 300,000 barrels a day from 255,000 barrels a day in 2010, according to the Energy Ministry’s statistics.

OAO TNK-BP, a Russian joint venture between BP and a group of billionaires, increased average production by 0.7 percent to 1.64 million barrels a day in 2011. TNK-BP pumped 1.65 million barrels a day in December, including its share of crude from OAO Slavneft, a venture with OAO Gazprom Neft.

OAO Lukoil, Russia’s second-largest producer after Rosneft, pumped 5.31 percent less crude in the country last year, averaging 1.71 million barrels a day, ministry statistics showed. December output was little changed from November at 1.69 million barrels a day.

Russia’s natural-gas output rose to 2.03 billion cubic meters a day in December from 2.02 billion cubic meters a day in the same month a year earlier, according to the statistics.

--Editors: Bruce Stanley, John Buckley

To contact the reporter on this story: Stephen Bierman in Moscow sbierman1@bloomberg.net.

To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net.


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