LUKoil faced reserve shortage in 2010

MOSCOW. January 14. KAZINFORM Russia's largest private oil company LUKoil faced a lack of reserves last year but hopes to solve the problem by boosting exploration and efficiency as well as through cooperating with state energy companies, LUKoil President Vagit Alekperov said on Friday; Kazinform refers to RIA Novosti.

"The company faced a lack of resources for further development and a decline of active drilled reserves. As a result, we'll have to increase resources by means of geological exploration and a higher oil extraction ratio at open fields, and faster conversion of resources into proven reserves," Alekperov said.

According to preliminary data, by Russian classification, LUKoil's hydrocarbon reserves increment in 2010 reached 123 million tons of oil equivalent. The company discovered six deposits in the Perm region in Russia, Uzbekistan, Egypt and Ghana as well as 25 oil fields.

LUKoil produced 1.7% less oil in 2010, or 96 million tons as the company's West Siberian deposits depleted, the firm said on Thursday. The company's gas output in 2010 stood at about 20 billion cubic meters according to preliminary data, exceeding the 2009 level by more than 12%.

Last year, LUKoil signed an agreement to develop the West Quirna-2 deposit in Iraq and started extracting oil in the Caspian Sea.

Alekperov said another way to get access to new resources was cooperation with state-controlled companies.

"We are working hard in that direction jointly with Rosneft, Gazprom and Gazprom Neft," he said.

Alekperov has said company output may fall as LUKoil reroutes its investment to projects in the Caspian Sea, Iraq and Western Africa but will later spike. In 2011-2013, hydrocarbons output will increase 4% a year; Kazinform cites RIA Novosti.


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