Rosneft's 2019 hydrocarbons output flat at 5.8 million boe/d

Moscow — Rosneft's hydrocarbons production in 2019 was more or less steady year on year at around 5.8 million b/d of oil equivalent despite the company having to comply with OPEC+ restrictions, CEO Igor Sechin said Tuesday.

"Production volumes in 2019 were at the same level as the previous year; that is 285.5 million mt of hydrocarbons," Sechin said during a meeting with Russian President Vladimir Putin, according to a transcript posted on the Kremlin's website.

Sechin did not provide a separate figure for oil production, but it averaged around 4.67 million b/d in the first three quarters of 2019, according to previously released results.

"Despite the worsening external environment, and a certain decrease in oil prices, around 7%, production results remained positive," Sechin said.

Russia's participation in the OPEC+ crude production agreement limited Rosneft's output in 2019.

"We complied with OPEC+ restrictions, and this led to some restriction of production. But this also affected prices on the market," Sechin said.

The boost to oil prices has been a positive for Russian oil companies, but they have also highlighted concerns over complying with the deal.

Those include missing out on market share and difficulties planning investment programs while there is uncertainty over how much crude they will be allowed to produce.

The company planned to invest Rb2 trillion ($31 billion) in stage one of its Vostok Oil project, with total investment in the project set to reach more than Rb10 trillion, Sechin said.

Vostok Oil will combine production assets on the Taimyr Peninsula in northern Russia and has a resource base of around 5 billion mt (36.5 billion barrels) of oil, he said.

It includes the Vankor project, as well as other assets nearby including the Payakhskoye and West Irkinskoye fields. Rosneft is in talks with Indian companies on joining the project.

Rosneft also increased its seismic exploration by 12.3% last year, surveying 11,300 square kilometers.

Downstream results

Rosneft refined 110 million mt of crude and condensate in 2019, including 10 million mt at plants abroad, Sechin said, without giving any comparison figures.

The company also extended supply contracts with European customers.

"Long-term contracts for the supply of oil via the Druzhba [pipeline] to Poland, the Czech Republic and Germany were extended," Sechin said.

Rosneft's investments totaled almost Rb3 trillion in 2019.

Sechin said the company's costs are the lowest in the world, and its reserves are the largest among public oil companies.