While increasing oil drilling, Russian companies cut investments in the development of the business.
According to the suppliers of equipment, the amount of the orders placed by oil companies, was greatly decreased.
The Izvestia estimate the companies net profit for 2003 as $25 billion, while the companies invested $7 billion in their business in 2003. For the first months of 2004 the companies extracted more oil than for this period in 2004, by 10.7 percent. The increase of oil drilling resulted from the high prices for oil both in domestic and foreign markets.
Totally, the oil companies earned $70.1 billion in 2003 (without value added tax). According to the companies’ information, LUKOIL is the leader of oil drilling. LUKOIL and its affiliated companies extracted 21.2 million tons of oil for the first 3 months of 2004. LUKOIL increased its oil drilling by 7.9 percent, while YUKOS company extracted oil more by 9.3 percent than for the same periods of 2003.
Slavneft increased its oil drilling more than all other companies – by 29.7 percent. However, the total amount of Slavneft oil drilling is only 6.85 million tons. According to the company representative Ilia Medvedev, Slavneft started exploiting several horizontal oil wells with big volume of oil, in Khanty-Mansiisk region.
Russia is the only oil exporter worldwide increasing oil drilling as demand for oil grows, says the monthly report by the experts of International Power Agency on the conditions of the market of natural resources from May 13, 2004.
According to the report, for the first 4 months of 2004 oil drilling in Russia was increased by 30 percent. Meanwhile, the other exporters, first of all OPEC countries, are reducing their oil drilling.