• 2 minutes U.S. Presidential Elections Status - Electoral Votes
  • 5 minutes “Cushing Oil Inventories Are Soaring Again” By Tsvetana Paraskova
  • 7 minutes United States LNG Exports Reach Third Place
  • 8 mins https://www.prageru.com/video/whats-wrong-with-wind-and-solar/
  • 4 hours The World Economic Forum & Davos - Setting the agenda on fossil fuels, global regulations, etc.
  • 13 mins Here it is, the actual Complaint filed by Dominion Voting Machines against Sydney Powell
  • 19 hours JACK MA versus Xi Jinping
  • 36 mins CNN's Jake Tapper questions double amputee purple heart recipient GOP Rep's commitment to democracy. Tapper is a disgrace.
  • 18 hours Researchers Are Harvesting Precious Metals From Industrial Waste
  • 2 days Tonight Twitter took down Trump's personal account permanently. Trump responded on the POTUS account.
  • 45 mins 'Get A Loan,' Commerce Chief Tells Unpaid Federal Workers
  • 4 hours Minerals, Mining and Industrial Ecology
  • 8 hours Do Republicans like Liz Cheney, Adam Kinzinger, Mitt Romney and now McConnell think voting for Impeachment can save the party ? Without Trump base what is the Republican constituency ? It's over.
  • 2 days A Message from President Donald J. Trump - 5 minutes from The White House directly
Irina Slav

Irina Slav

Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.

More Info

Premium Content

Russian Banks To Finance 200,000 Bpd In New Oil Production Capacity

  • At least two Russian banks are lending some $6 billion to the oil industry to drill new wells that could add 200,000 bpd to the country’s production quickly.
  • It is a tactic the Russian companies likely borrowed from its U.S. competitors: drilling but not completing wells to have new production at the ready when prices call for it.

At least two Russian banks are lending some $6 billion to the oil industry to drill new wells that could add 200,000 bpd to the country’s production quickly, unnamed sources have told Reuters.

It is a tactic the Russian companies likely borrowed from its U.S. competitors: drilling but not completing wells to have new production at the ready when prices call for it, so they can bring it online fast--completing an oil well takes a lot less time than drilling the whole thing from scratch.

Energy Minister Alexander Novak said in late April that oil companies may start drilling but not completing wells for future production in order to keep oilfield service providers in the business. Now, another goal would be to help Russia maintain or expand its market share on short notice if demand rebounds.

Russia’s oil production is down by about 2 million from last year’s average of 11.3 million bpd per its agreement with OPEC+. Most of the wells that Russian companies had to shut to effect the production cuts were mature ones and may not be brought back on stream when—and if—prices recover, Reuters noted in its report.

This means that new production will be necessary but, if possible, without the full investment done upfront. Instead, the investment will be distributed over a longer period and only when necessary to complete the wells so they can start producing.

Novak earlier this month said he hoped oil demand could recover next year to pre-pandemic levels. However, he noted that it could take two to three years for this recovery to materialize.

Oil demand has been recovering across the world as pandemic-forced national lockdowns began to be lifted and borders reopened. However, the situation is still fragile, with little clarity as to whether demand will improve to pre-crisis levels.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News