RussNeft expects $1 bln in 2006 net profit

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RussNeft expects $1 billion in net profit this year, the oil company's president said Monday.
ST. PETERSBURG, September 4 (RIA Novosti) - RussNeft expects $1 billion in net profit this year, the oil company's president said Monday.

RussNeft, Russia's newest vertically integrated oil company, is among the country's top 10 crude producers. Its recoverable reserves exceed 630 million metric tons (4.6 billion barrels).

"We expect to garner $1 billion in net profit in 2006," Mikhail Gutseriyev said, adding that the company's earnings were $6 billion at the moment.

He did not rule out that RussNeft might hold an initial public offering, which may take several years. "Such an idea has been proposed, and we are currently adjusting the company's structure," Gutseriyev said.

He said the company's management was working on a five-year development strategy, which envisions the increase of annual oil production from 17 million metric tons (341,000 bbl/d) to 20 million tons (400,000 bbl/d) next year by developing new deposits.

Gutseriyev said a five-year investment program has been drafted to funnel $1.5 billion into production facilities.

The company will prepare its 2005 report, calculated to International Financial Reporting Standards, by mid-fall.

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