Russia Wants Foreign Companies to Go Beyond Oil Production – Bogdanchikov

MADRID. June 30 (Interfax) – The participation of foreign companies exclusively in the production of oil does not meet the interest of Russia, Rosneft (RTS: ROSN) President Sergei Bogdanchikov said at the 19th World Oil Congress in Madrid.

“We think that cooperation between Russian and foreign companies must be mutually beneficial and include shares in each other’s charter capitals, a swap of assets in Russia and abroad, and joint comprehensive projects involving oil production, transportation, refining and selling,” he said.

Such cooperation is only possible if partners clearly understand and respect each other’s interests, Bogdanchikov said.

The Russian government targets products with a high added value, such as refined oil and gas and petrochemical products, he said.

“The appeals of Russian officials for giving additional incentives to refining companies create good opportunities for foreign companies, which wish to have an access to Russian resources,” he said.

The development of Russian hydrocarbons is relatively cheap, as compared with the fields developed in the Gulf of Mexico and the North Sea, he added.

The Russian government is reducing mineral development taxes, which will promote a larger output of hydrocarbons, Bogdanchikov said. In the opinion of the Russian Energy Ministry, Russia will retain positive dynamics in the production of crude and natural gas for the next two decades. The crude production might reach four billion barrels by 2015 and 4.4 billion barrels by 2030, while gas production might grow to 750 billion cubic meters by 2015 and 880 billion cubic meters by 2030. The exports of oil and gas will continue to grow.

As the international demand for energy is mounting, Russia is expanding export pipelines, Bogdanchikov said. Ten years from now the capacity of Russian export pipelines will enlarge from the current 1.6 billion barrels to 2.2 billion barrels and from 200 billion cubic meters of gas to 300 billion, he said.

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