“I know of no one who had predicted that Russian production would rise in 2015, let alone to new record levels,” Edward Morse, Citigroup’s global head of commodities research said.
Although Russia’s output growth was lower than that of the US and Saudi Arabia (up 1.3 and 5.8 percent respectively), the pace matched that of the OPEC cartel, according to Citigroup Inc.
Bloomberg explained that Moscow owes its success to “productivity improvements” across the industry.
The brightest instance of this trend is the work of Bashneft in 2015, Bloomberg noted, adding that the producer accounted for the highest crude output of all Russian companies. Bashneft also showed the best performance of all players on the Russian stock market within the last 12 months.
The company produced higher amounts of oil across areas discovered in the previous century that had been widely ignored by Soviet authorities. Bashneft boosted production in those sectors by a factor of 20. The company additionally used custom-designed pumps, produced locally, and so not affected by the Western sanctions.
“We’re up 3 percent since the beginning of the year at our mature fields in Bashkiria, the oldest of which has been in production for 83 years and already produced 1.7 billion tons (12.5 billion barrels) of oil,” Mikhail Stavskiy, First Vice President of PJSOC Bashneft, said.
Even a 52 percent fall in the value of the ruble following the oil price decreases played into the hands of many Russian companies, as they reduced their costs in dollar terms up to 90 percent.
Smaller companies that boosted production and drilling saw increased output this year, as bigger players declined. Among winners along with Basneft were such companies as Irkutsk Oil Co. in Siberia and Exxon Mobil-led Sakhalin-1.
