Deputy Vice-Premier Sechin Certain Rosneft Will Remain Leader in Russian Oil Industry

MOSCOW. May 16 (Interfax) – Igor Sechin, the chairman of the board of Rosneft (RTS: ROSN), said he has no doubt the company will remain a leader in the Russian oil industry and will continue to develop dynamically for the benefit of all of its shareholders.

Rosneft managed to grab the leading position in the Russian oil sector, in particular by such key indicators as oil production, growth in the supply of hydrocarbons, and marginal current and capital costs, in 2007, Sechin said in an address published in an annual report prepared for the annual shareholder meeting.

The acquisition of new assets in 2007, as well as the expansion of geological exploration at main production enterprises and increased oil production at Yuganskneftegaz and Sakhalin-1 have allowed the oil company to produce more than 100 million tonnes of oil per year, Sechin said.

“Having considerably increased the scale of its activities as a result of the integration of a number of assets within the corporation, primarily in oil processing and the supply of oil products, the company has not only emerged as the leader in oil production, with operations in 50 Russian regions, but it has also managed to drastically change the earlier existing imbalance between oil production and oil processing,” the address says.

“The results of Rosneft’s activity in 2007 vividly disprove arguments that it is impossible to make companies run by the state highly efficient,” Sechin said.

Rosneft’s IPO and its subsequent status as a public company played an important role in its development, he said. “As a public company, Rosneft has vast opportunities to attract capital in order to pursue large capital-intensive projects, as well as the preconditions for active interaction with foreign partners thanks to the similarity of the management culture,” he said.

The oil company pins great hope on the development of fields in Eastern Siberia, while projects on the Far East shelf, including Kamchatka, where Rosneft works with the world’s largest oil and gas companies, remain of a strategic nature, the address says.

“The de facto status of national oil company will allow Rosneft to develop cooperation with the world’s largest companies and to play an important role in ensuring global energy security in the most efficient and lucrative manner,” Sechin said.

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