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After OPEC - What’s Next For Oil Prices?

After OPEC - What’s Next For Oil Prices?

Crude oil prices surged Wednesday…

Oil Falls As OPEC Euphoria Abates

Oil Falls As OPEC Euphoria Abates

Oil prices fell for the…

Gazprom Neft Ups Arctic Field Output

Gazprom neft offshore rig

Gazprom Neft Shelf, a subsidiary of Gazprom’s crude oil arm, announced it had increased the daily output at the Prirazlomnoyue field in the Arctic to over 6,000 tons, or 43,980 barrels daily. The increase came after the company drilled four more wells at the offshore field in the Pechora Sea, bringing the total up to six.

Production from the Prirazlomnoye field (“pri” meaning by, or at; “razlom” meaning to fracture), whose estimated reserves are 70 million tons of crude, began in 2013. For the moment, it’s the only field in the Arctic shelf of Russia where crude is being extracted.

Since the start in 2013, more than 10 million barrels of oil have been pumped at the field, which sports the Prirazlomnaya platform. The platform employs a zero-waste system that prevents the release of any by-product of drilling or oil extraction into the sea. To achieve full-scale production, Gazprom Neft plans on drilling 32 wells.

The company said at the reaching of the 10-million-barrel milestone that it now expects a peak annual output of 35 million barrels of crude.

Earlier this year, Gazprom Neft also became the first company in Russia to conduct a 30-stage fracking operation at the Yuzhno-Priobskoye field in western Siberia.

Arctic oil exploration has been a controversial issue, as the amount of recoverable reserves matches the difficulty of drilling in this extreme climate. What’s more, the environmental consequences of a spill would be difficult to control, according to Greenpeace and other environmental organizations, and could have devastating effects on local ecosystems.

A lot of international majors had Arctic plans before the oil price rout started, and suffered losses when they were forced by the market environment (and in some cases environmentalist opposition) to abandon them. Perhaps most notable among them was Shell, which had spent some US$7 billion on the project before it quit last year.

By Irina Slav for Oilprice.com

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