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Russian Energy Ministry frecasts oil production in Russia in 2019 at 556-560 mln tonnes

December 06, 2019/ 11:50

According to preliminary estimates, oil production in Russia in 2019 will suprass last year's rates and will reach 556-560 million tonnes, Russian Energy Minister Alexander Novak said in an article published in the Energeticheskaya Politika (Energy Policy) magazine.

"Despite volatility on global markets, Russia's oil industry has demonstrated for several years a tendency toward stable development. According to preliminary forecasts, oil production will be higher in 2019 than last year - at 556-560 million tonnes," Novak said.

The energy minister earlier said that oil production in 2019 is estimated to reach 556-557 million tonnes, which is similar to the 2018 level.

In 2018, oil production in Russia reached 555.9 million tonnes, according to the Energy Ministry.

Oil reserves

Preliminary field inventory data indicates that oil reserves in Russia stand at 28.9 billion tonnes, with only 10.3 billion tonnes of those being profitable.

"According to statements by the Federal Service for Supervision of Natural Resources, there are around 2,700 oil deposits with total reserves of 28.9 billion tonnes," Novak said.

He added that only 60% of analyzed deposits are considered profitable. "The state oil reserves commission's assessment is based on approaches similar to international standards for auditing deposits of natural resources, where average oil prices at $69 per barrel and exchange rate of 63 rubles per 1 US dollar are used from the previous year of 2018. As a result, only around 60% of reserves are considered profitable," he explained.

Gas production

Russia will increase gas extraction by 2% to 740 billion cubic meters in 2019 compared to last year, Russian Energy Minister noted.

"For further reliable gas supplies to domestic and foreign consumers, gas production continues to increase. This year this rate is expected to increase by 2% compared to last year's record for the gas industry and reach aroudn 740 million cubic meters," Novak said.

He added that Russia has impressive success on the liquefied natural gas (LNG) market. "We really see impressive success here. We hope that at the end of the year, export of LNG will increase by almost 44% and reach around 39 billion cubic meters," he noted.

In 2018, gas production in Russia increased by 4.9$ compared to the previous year and reached 725 billion cubic meters. LNG export increased by 70% in the same period and reached 26.7 billion cubic meters.

Coal production and export

Novak also said that coal extraction in Russia is projected at 440 million tonnes in 2019.

"In 2019, the coal industry continued its gradual development. Extraction and export of coal at the end of the year is projected at the levels of last year - at 440 million tonnes and 210 million tonnes respectively, while projected investment in coal companies will stabilize at the level of 2018 and will reach around 140 billion rubles," the minister said.

According to the Russian Energy Ministry, coal production in Russia stood at 439.3 million tonnes in 2018, and coal export - at 193.2 million tonnes. Thus, coal export will increase by 8.6% year-on-year in 2019.

The Russian Energy Ministry and the Russian Economic Development Ministry earlier forecasted coal production in Russia to exceed 450 million tonnes in 2019.

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