Sibneft Unveils Long-Term Growth Strategy

Moscow, 25 June 2002; Sibneft aims to increase oil production to 830,000 barrels per day (42 million tonnes) by 2005, under a long-term growth strategy announced today. The company aims to maintain high growth rates through a combination of continued high investment, the application of world class production technology and further enhancement of the company’s core reservoir management capabilities.

Sibneft’s giant Sugmut field, which harbours reserves of close to a billion barrels (140 million tonnes), is forecast to make a contribution of 140,000 barrels per day (7.2 million tonnes). Output from the Priobskoye and Palyanovskoye fields licensed to the Sibneft-Yugra joint venture is projected to reach 80,000 barrels per day (4.1 million tonnes), while the Sporyshevskoye field is targeted to yield production of 65,000 barrels per day (3.4 million tonnes).

Sibneft aims to increase its recovery rate from 29.5% today to over 40% over the next two decades, thanks to improved field development planning. The company has prepared world class field development plans for the majority of its fields using a state-of-the-art geological modeling facility at the company’s main base in Noyabrsk.

“Sibneft will focus in the short term on unlocking the huge potential of its existing asset base,” said Sibneft president Eugene Shvidler. “We intend to complement organic growth with strategic acquisitions in both the upstream and downstream, with the aim of achieving balanced and sustainable growth.”