En Español



Very usefull links



PW
Bookstore





Institutional
links


OPEC
\





 




PW
Business Partners

 


IRAQ OIL

THE FORUM

 


Blogspots

FxHQ Forex News

The Global Barrel

Tiempo Cultural

Gustavo Coronel

Iran Watch.org

Le Blog des
Energies Nouvelles

News Links

AP

AFP

Aljazeera

Dow Jones

Reuters


Bloomberg

Views and News
from
Norway

 

 

 

Lagniappe


Julian Lee: Goldman's hopeful oil call



In a July 19 report , Goldman Sachs analysts
painted a hopeful picture for Russian oil production

 

 

International oil companies aren't spending enough on the extra capacity needed to meet demand by the end of the decade. So it will fall to countries like Russia to provide the additional production on which we will all depend.

Can Russia do it?

In a July 19 report , Goldman Sachs analysts painted a hopeful picture for Russian oil production -- putting the bank at odds with the forecast made earlier this year by the International Energy Agency. The latter, though, is more likely to be correct.

Divergent Views

Goldman Sachs and the IEA have very different views on the future of Russian oil production


Includes crude, condensate, NGLs and oil from non-conventional sources

Goldman expects growth in Russian production to accelerate, with output hitting 11.7 million barrels a day by 2018, an increase of almost 600,000 barrels a day from 2015. By contrast, the IEA expects output to fall by 160,000 barrels a day over the same period.

Rosneft accounts for more than a third of Russia's output, so the oil giant's performance over the coming years will be a big driver of what happens in Russia as a whole.

Worryingly, the company's output has been steadily declining ever since it acquired TNK-BP in 2013. Production has fallen by 120,000 barrels a day, or 3 percent, since then.

Rosneft in Retreat

Rosneft's production has fallen by 120,000 barrels a day, or 3%. since December 2013

Source: Bloomberg NOTE: Includes TNK-BP production throughout

More than half of the decline has come at Yuganskneftegaz, the oil production business it acquired from Yukos. Output there declined 5 percent in the period.

Two of Rosneft's other key legacy assets are also in decline: Samotlor, once Russia's most prolific field, is pumping just 400,000 barrels a day -- 14 percent less than in 2013. Orenburgneft's production also fell to less than 1.2 million barrels a day last month.

Even projects that had been helping Rosneft's output to increase are beginning to falter. Look at production from the Vankor field, which has slipped 5 percent from its peak of about 445,000 barrels a day.

Vankor in Decline

Production from nearby fields may only offset falling output from Vankor

Source: Rosneft

Goldman Sachs expects a slew of new projects -- among them the Suzun, Tagul, Yurubcheno-Tokhomskoye and Messoyakha projects -- will increase output to 850,000 barrels a day by 2018 from 470,000 barrels a day last year.

But output from all of these fields will be limited by available pipeline capacity -- and it's far from clear that there will be enough of it to support a 380,000 barrel-a-day increase in production over the next two-and-a-half years.

Suzun and Tagul are two fields close to Vankor that Rosneft acquired when it bought TNK-BP. Rosneft plans to ship the combined output from Vankor, Suzun and Tagul through its 500,000 barrel-a-day pipeline. That suggests that the new fields can't add more than 77,000 barrels a day to production -- the difference between the line's capacity and Vankor's current production. Any output above that level would merely be offsetting further declines at Vankor.

There is a similar problem at the Yurubcheno-Tokhomskoye and Kuyumbinskoye projects. Peak output from the fields, due to commence production this year and next, could total about 400,000 barrels a day. But the pipeline that will connect them to the export network will have an initial capacity of just 180,000 barrels a day. That's not expected to rise to 310,000 barrels until 2023, according to Goldman.

Meanwhile, Russia's crude oil production should be higher this year than last. Production in the first half was up 180,000 barrels a day from the year-earlier period. But the figure for June was 80,000 down on January as output fell almost every month. That could make it more difficult to sustain year-on-year growth in 2017.

Managing the decline in output from Russia's ageing fields in the swamps of West Siberia will be crucial in determining whether the country will be able to boost production in coming years. Nowhere is that more important than at Rosneft.

Julian Lee is an oil strategist for Bloomberg First Word. Previously he worked as a senior analyst at the Centre for Global Energy Studies. Petroleumworld does not necessarily share these views. This column does not necessarily reflect the opinion of Bloomberg LP and its owners. Julian Lee (jlee1627@bloomberg.net), editor- Jennifer Ryan (jryan13@bloomberg.net)

Editor's Note: This commentary was originally published by Bloomberg on July 24, 2016. Petroleumworld reprint this article in the interest of our readers.

All comments posted and published on Petroleumworld, do not reflect either for or against the opinion expressed in the comment as an endorsement of Petroleumworld. All comments expressed are private comments and do not necessary reflect the view of this website. All comments are posted and published without liability to Petroleumworld.

Use Notice:This site contains copyrighted material the use of which has not always been specifically authorized by the copyright owner. We are making such material available in our efforts to advance understanding of issues of environmental and humanitarian significance. We believe this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml.

All works published by Petroleumworld are in accordance with Title 17 U.S.C. Section 107, this material is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes.Petroleumworld has no affiliation whatsoever with the originator of this article nor is Petroleumworld endorsed or sponsored by theoriginator.
Petroleumworld encourages persons to reproduce, reprint, or broadcast Petroleumworld articles provided that any such reproduction identify the original source, http://www.petroleumworld.com or else and it is done within the fair use as provided for in section 107 of the US Copyright Law.

If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission from the copyright owner. Internet web links to http://www.petroleumworld.com are appreciated

Copyright© 1999-2009 Petroleumworld or respective author or news agency. All rights reserved.

We welcome the use of Petroleumworld™ stories by anyone provided it mentions Petroleumworld.com as the source. Other stories you have to get authorization by its authors.Internet web links to http://www.petroleumworld.com are appreciated

Petroleumworld welcomes your feedback and comments,
share your thoughts on this article, your feed. back is important to us!

Petroleumworld News 07/25/2016

 

We invite all our readers to share with us
their views and comments about this article.
Follow us in : twitter / Facebook
Send this story to a friend Write to editor@petroleumworld.comBy using this link, you agree to allow PW
to publish your comments on our letters page.

Any question or suggestions,
please write to: editor@petroleumworld.com

Best Viewed with IE 5.01+ Windows NT 4.0, '95,
'98,ME,XP, Vista, Windows 7,8 +/ 800x600 pixels

 

 

 

 



TOP

Editor & Publisher:Elio Ohep Fitzgerald./Contact Email: editor@petroleumworld.com

Contact:
editor@petroleumworld.com/ phone: Office (58 212) 635 7252,
or Cel (58 412) 996 3730 / (58 414) 276 3041 / (58  412) 952 5301


CopyRight © 1999-2010, Elio Ohep Fitzgerald.- All Rights Reserved. Legal Information

- CCS Office Tele
phone/Teléfonos Oficina: (58 212) 635 7252

PW in Top 100 Energy Sites


Technorati Profile


CopyRight © 1999-2016 Elio Ohep Fitzgerald. - All Rights Reserved.
This material may not be published, broadcast, posted online, rewritten or redistributed by any type of means, except with permission of the author/s

The information in this web site is proprietary and is protected under United States and International Copyright and Trademark laws. No part of this web site may be reproduced or transmitted in any form by any means whatsoever, except with permission of the author/s..

Petroleumworld encourages persons to reproduce, reprint, or broadcast Petroleumworld articles provided that any such reproduction identify the original source, http://www.petroleumworld.com or else and it is done within the fair use as provided for in section 107 of the US Copyright Law. If you wish to use copyrighted material from this site for purposes of your own that go beyond
'fair use', you must obtain permission from the copyright owner.
Any use of this site or its material, in any form, without the express prior written consent of the author, is prohibited by law and is subject to legal action. Legal Information

Top 100+

Technorati Profile
Fair use notice of copyrighted material:

This site is a public free site and it contains copyrighted material the use of which has not always been specifically authorized by the copyright owner.We are making such material available in our efforts to advance understanding of business, environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have chosen to view the included information for research, information, and educational purposes. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission from Petroleumworld or
the copyright owner of the material.