Russia Oil and Gas Industry

By: EconomyWatch   Date: 30 June 2010

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Deolitte has made a thorough study on Russia oil and gas industry. According to this survey, conducted by Deolitte on oil and gas industry of Russia, domestic demand for oil would gradually increase from 2008 onwards. Forecast for global oil demand also shows a similar gradual rise. This survey focusing on Russian oil and gas industry till 2012 end predicts an increase of 61% in annual gas consumption by that point of time. If expenditures are indicators of exploration and development, 33% of companies in oil and gas industry at Russia would significantly increase their expenses on development while 39% would increase their expenses on exploration.

Sibir Energy in 2008 December completed acquisitions of OAO Avtocard and OAO Korimos buying 100% and 50% of their shares respectively. Korimos, a 50:50 joint venture with Moscow Refinery, uses products of this refinery to produce tertiary amyl methyl ether (TAMR) and methyl tertiary butyl ether (MTBE) which are used in oil refining. Korimos also owns six gasoline outlets in Moscow. Avtocard specializes in non-cash wholesale of oil products through Sibir’s MTK retail channel. Sibir has also acquired assets of Orton Oil Company Limited, and Gradison Consultants Inc.

KazMunaiGaz (KMG), National Oil Company of Kazakhstan and ONGC Mittal Energy Limited (OMEL) have signed a head of agreement (HOA) deal for oil and gas exploration in Satpayev Block and Caspian Sea in Kazakhstan. Satpayev Block in pre-Caspian basin spanning an area of nearly 1600 sq. km. is in proximity to major gas and oil fields of Kalamkas, Kashagan, Donga and Karazhanbas.

StatoilHydro has signed agreements with schools in Arkhangeisk and Murmansk for training students in oil exploration and processing. StatoilHydro has taken up this endeavor to alleviate problem of low trained manpower in these north western regions of Russia. Large scale changes in oil and gas industry in Russia is anticipated within next five years if StatoilHydro’s educational and training program becomes successful. OMV has been successful in overcoming shortage of natural gas in Russia. Based in Austria, OMV was able to store natural gas amounting to 1.7 billion cubic meter in January 2009.


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