Reuters

Russia's biggest oil firm LUKOIL is planning a 14-fold jump in natural gas production by 2010 with the aim of raising exports 50 times over, according to a senior company executive.

Andrei Gaidamaka, LUKOIL's deputy director of investment strategy, said gas output would rise to 69.3 billion in 2010, and 84.3 billion in 2020 from five billion cubic metres in 2000.
"Significant growth is likely to come from LUKOIL's Caspian reserves and new volumes will be monetised through liquefied natural gas (LNG) projects and through build up of pipeline export volumes," Gaidamaka told an oil conference in London late on Tuesday.

He said the aim was to ramp up exports from just 10 percent of total output in 2000 to 35 percent by 2010 and 50 percent by 2020, with the remainder sold to the domestic Russian market.
That would take total exports from just 500 million cubic metres in 2000 to 24.5 billion in 2010 and 42 billion in 2020.

The bulk of the increased output will come from Yamal region of northern Russia while LUKOIL aims to quickly raise its output in the Russian side of the Caspian from 2004-2005, when it plans to begin commercial production of oil and gas in the area.

"We aim to start commercial production of crude oil from the Russian Caspian in 2004," Gaidamaka said, adding that gas output would begin in the 2004-2005 timeframe.

Gaidamaka also said LUKOIL was aiming to increase the crude processing capacity of its four Russian and three foreign refineries -- in Bulgaria, Romania and Ukraine -- to over 60 million tonnes this year.

That represents a 55-60 percent hike on the 2001 total of 38 million tonnes, as reported in LUKOIL's 2001 financial results released last month.

Gaidamaka said recent investment at LUKOIL's two largest refineries at Perm and Volgograd had resulted in increased upgrading capacity, enabling higher output of motor fuels mainly for the domestic market.

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