Russneft to prune investments to $500 million per year
At the same time, this year the company maps out to increase the production by 1 million tons.
One of the largest Russian oil companies Russneft has approved its development strategy through untill 2017, and the investment volume won’t exceed $500 million per year, the company’s Head, Mikhail Gutseriev reported to journalists, as the Prime transmits. For this period the production about 18 million tons per year and the minimal investments are provided for, he told. According to Gutseriev, the company’s strategy provides for the use of point deposits, high-rate wells, minimal capital costs and maximum production growth. Stick to the strategy, Russneft expects to increase the production by 1 million tons this year.
The company’s Head told that the company doesn’t plan to buy any assets in Russia or abroad untill 2015, because it hasn’t financial opportunity for this. Gutseriev reported they will be able to think about deals when Russneft repays Sberbank – perhaps, the company will ask the bank for a new loan. According to Gutseriev, Russneft intends to pay all debts off to Sberbank by 2015, and to repay Glencore by 2017. These companies are the largest creditors of Russneft. According to him, as of beginning of this year, the company’s debt reached $4.9 billion, and it is planned to be decreased to $4.3 billion by the end of the next one.
Gutseriev told that Glencore hasn’t proposed the appropriate price for the conversion of shares in Russneft’s subsidiaries into shares of the oil company itself. The businessman reported that the whole issue is price, and if it is appropriate, then Gutseriev will be ready to sell or exchange securities even tomorrow. The businessman added that the projects that are implemented by him in Kazakhstan and Azerbaijan have no relation to the Russneft.
In July of the last year, Russneft within its development strategy sold its subsidiary - the Orsk oil-processing plant – to foreign investors. The company reported that the money will be used to repay its loan obligations. In 2010, Gutseriev promised that Russneft will repay $ 12 billion of debt during 10 years, including interest. The company stated that last year the volume of investment amounted to 14 billion rubles, including 10 billion rubles was directed to the drilling, one billion rubles - for the construction of a pipeline in the Tyumen region and about three billion rubles - for gas utilization projects. Last year, Russneft made a net loss of 3.823 billion rubles, against to a profit of 2.05 billion rubles a year earlier.
http://www.bfm.ru/news/2012/06/26/russneft-urezaet-investicii-do-500-mln...
Translated by Svetlana Kyrzhaly
