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    OIL PROSPECTING FOR SAKHALIN-5 PROJECT STARTS IN 2004

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    YUZHNO-SAKHALINSK, May 20 (RIA Novosti) - At a press conference on Thursday in Yuzhno-Sakhalinsk, the administrative center of the Sakhalin region, the president of Rosneft, Sergei Bogdanchikov, confirmed that the prospecting work as part of the Sakhalin-5 project will start in 2004. (Sakhalin is a Russian island in the Pacific Ocean.)

    "The work, to make a 4,000 meter deep five-section well, will be difficult," Mr. Bogdanchikov pointed out.

    In his opinion, Rosneft's activity in the Russian Far East is dynamic and the company's branch enterprises are working more successfully than in the past few years.

    In March, the Rosneft and the British Petroleum signed an agreement on basic principles of cooperation in implementing the Sakhalin-5 project. The total cost of the project will be $3-3.5 billion, $150-170 million of which will be spent on prospecting for oil. Prospecting will last until 2008.

    Rosneft holds 51% of the Sakhalin-5 project and British Petroleum holds 49%.

    In 2003, Rosneft's net profit grew by 64% in comparison to 2002 and amounted to $25.7 billion ($1 is approximately 29 rubles).

    Last year, the Rosneft received six new licenses to conduct geological surveys, including four plots on the Sea of Okhotsk shelf (Sakhalin-3 and Sakhalin-5), the Tuapse depression in the Black Sea and the Chatylkin-Udmurdian section of the Yamal-Nenets Autonomous Area (Northwest Siberia).

    The company has also sent 19 new applications for conducting geological surveys.

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