Drilling at Russia's oil production wells likely beat a post-Soviet record in 2023, according to industry data Bloomberg has seen-evidence that the Western sanctions haven't affected drilling rates much, especially at brownfields.
Russia is estimated to have drilled oil production wells with a total depth of 28,100 kilometers (17,460 miles) between January and November 2023-on course for a second consecutive year that would beat the post-Soviet record for drilling, per the data seen by Bloomberg.
The record-high rates of drilling suggest that Russian producers are trying to maximize production from older oilfields to keep production rates from falling, analysts say.
Despite the withdrawal of major international oilfield services providers, drilling rates continue to be high as those providers sold off their Russian businesses to the local management teams who have experience in well drilling and management.
"Russia is substantially more independent in its oil-field services than generally appreciated," Ronald Smith, an oil and gas analyst at Moscow-based BCS Global Markets, told Bloomberg.
Halliburton announced last year it completed the sale of its Russia operations to a Russia-based management team made up of former Halliburton employees.
Baker Hughes signed in August last year an agreement to sell its Oilfield Services business in Russia to its local management team.
The new Baker Hughes and Halliburton businesses in Russia operate independently of their former parent companies.
Russian oil producers accelerated the drilling of production wells in the first half of 2023 despite the Western sanctions, data seen by Bloomberg showed in July.
Russian exploration and production companies drilled more overall length of production wells in the first half of 2023 than in the same period of 2022 and than the drilling target, the data showed. The total length of newly drilled wells rose by 8.6% year over year between January and June and was 6.6% more than the planned drilling activity.
By Charles Kennedy for Oilprice.com
Charles is a writer for Oilprice.com More
Comments
Until technology resolves the energy storage problem, renewables will need to be supported by huge contributions of gas, coal and nuclear energy well into the future.
Moreover, demand for coal will continue well into the future because it generates the cheapest electricity in the world.
Dr Mamdouh G Salameh
International Oil Economist
Global Energy Expert