- The Washington Times - Saturday, November 23, 2002

GENEVA (UPI) Russian crude-oil production could reach 10 million barrels per day in two to three years, an influential petroleum industry executive predicted.
Such an output would put the former communist nation on par with Saudi Arabia, currently the world's top oil producer.
The prediction, from Togrul A. Bagirov, executive vice president of the Moscow International Petroleum Club, an umbrella group for oil companies that accounts for more than 90 percent of the Russian sector, is far more optimistic than U.S. government projections.
Earlier this week, the Energy Information Agency of the U.S. Department of Energy estimated it would take more than 20 years for Russia to achieve such production levels.
The agency, in its latest annual energy-outlook report Wednesday, said Russian oil production would continue to recover from the low levels of the 1990s and "reach 10.4 million barrels per day by 2025, 44 percent above 2001 levels."
Mr. Bagirov told United Press International that most of the anticipated increase would come from "recoverable oil without any additional investment."
Most of the extra petroleum would come from fields in traditional regions such as Siberia, he said.
The Russian oil industry is developing quickly, but the sector still needs some infrastructure projects, he said.
Mr. Bagirov said the development of new fields would surge ahead.
He said the recent buying spree by Russian companies of Western European refineries and retail distribution networks was also likely to continue.
"You cannot develop your upstream without investments on downstream," he said.
Mr. Bagirov, who was in Geneva to attend a United Nations-sponsored conference on energy security, told a news conference earlier this month that the Russian oil industry reached for the first time a production level of 8 million barrels per day.
The U.S. agency's report projected oil production in the neighboring Caspian Basin to reach 5 million barrels per day by 2025, compared with 1.6 million barrels per day in 2001.
The U.S. agency also indicated America's dependence on foreign oil would continue to increase sharply in the future.
Economists at the agency project that net petroleum imports would account for 68 percent of total U.S. oil demand (crude and refined products) by 2025, up from 55 percent in 2001 and 37 percent in 1980.
Energy security, which dominated much of the global policy agenda in the 1970s and early 1980s, with the oil shocks of 1973-74 and 1979-80, has re-emerged as a crucial policy issue, U.N. energy experts say.
The recent attack on a French oil tanker near Yemen, and terrorist acts in major oil-producing countries such as Indonesia and Russia, coupled with the September 11 terror attacks, have contributed to a greater sense of vulnerability.
Alvaro Silva-Calderon, secretary-general of the Organization of the Petroleum Exporting Countries, said the 11-country group is ready to provide the world with the crude oil it needs.
The OPEC chief said there might be some doubts concerning security of supply today, but stressed "this is mainly due to the threat of war [against Iraq] we are having, not due to transportation or lack of reserves. "


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