Interfax citing Mr Vladimir Bogdanov CEO of Surgutneftegas as saying the company will increase capital investment in production 15% in 2011

Mr Bogdanov said "As for production and addition of new fields, investment last year was about RUB 120 billion and is targeted to rise 15% this year."

The increase is partly a result of rising charges and taxes. He said that "We need to increase the volume of production drilling in order to maintain production levels in Eastern Siberia."

Surgutneftegas expects production to rise 2% to 60.7 million tonnes in 2011. Gas production might decline 2.2% to 13.1 billion cubic meters.

The bulk of downstream investment RUB 20 billion to RUB 25 billion will go to completing construction of a high value added refining unit at the Kirishinefteorgsintez facility. Startup is scheduled for the first quarter of 2012. It will begin the second phase of modernization of the Kirishi refinery in 2012. Investment in the project might total RUB 183 billion.

Surgutneftegas invested RUB 20.8 billion in the refinery modernization in 2010 including RUB 3.3 billion to rebuild and modernize existing capacity and RUB 17.5 billion to complete construction of the high value-added unit based on fuel oil hydrocracking.

(Sourced from Interfax)

(Sourced from Interfax)