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Company in Mass Media

"Rus Oil continues expansion into regions"

20.10.2016. https://www.gazeta.ru/business/2016/10/20/10261457.shtml

The development of the oil company "Rus Oil", plans of production for 2017, complications in the work for "small" oil industry companies were told about to "Gazeta.Ru" by Deputy General Director of the oil producer, Mr. Anatoliy Fomin.

- Anatoliy Vasilyevich, more than 35 years you have been working in the fuel and energy complex of the country, both in different companies, and as Deputy Minister in the early 90th. Today, you are the First Deputy General Director of the Company Rus Oil Mr. Sergey Podlisetsky. How did you make your acquantiance?

- To be more precise, my general working experience can be counted from the moment of my study at Kazan University, and this is nothing more or less than 46 years. While my specialization - is "Geology and Exploration of Oil and Gas Fields", being a student I undertook an internship in geological survey expeditions to the Arctic Circle.

I met Podlisetsky Sergey Victorovich in 2011; our friends in common put us in touch. I consulted him actively on his project in the Orenburg region. This project served as an impulse for our further relations. In January 2013 already, I accepted his offer and headed the Scientific Council of the Company at first, and subsequently I became the First Deputy for Production. I can say, I stood at the origins of establishing this structure.

- Why were you interested in this offer, this project?

- The possibility to start from the point zero, with a clean slate. The practical implementation of the accumulated experience.

- Anatoliy Vasilyevich, speaking in general, what problems does the oil industry face today?

- The main problem, first of all - is the quality of assets. Small oil industry, as a rule, deals with fields with hard to recover reserves, which means a higher prime cost of the development. Moreover, there are problems with accessibility to oil transportation system of pipes. In order to create one's own system of oil transportation, additional investments are required.

- In my understanding, the company tries to apply different innovative technologies in oil production, which are required to operate difficult assets. Are there any examples?

- For quite a long time already, we use horizontal drilling with full maintenance cycle, we implement hydraulic fracturing (HF) actively. In this way, we carry out active development and production of Bazhenovskaya suite of Multanovsky field in the Western Siberia. A large part of combustible shales in Russia are concentrated there, which contain both organic solids, kerogen, and liquid light oil of low-permeable reservoirs. However, hydrocarbon reserves in Bazhenovskaya suite are hard-to-recover. In order to increase the oil recovery factor during oil development of low-permeable reservoirs, the inclined drilling and HF is applied actively. According to estimates of Rosnedr dated 2012, rocks can contain 180-360 bln barrels of recoverable reserves.

- How do you estimate current prospects of the company Rus Oil, including production in the medium term?

- Our plans are modestly optimistic. We have already told that production for 2017 is planned as 5 mln tons. Currently, we have six new agreements of fiduciary management executed, the development of fields will begin in 2017. Today, total recoverable reserves of Rus Oil company exceed 170 mln tons already. We will continue expansion to regions, plus we will develop actively our own oil transport infrastructure.

- Does the mechanism of fiduciary management has any nuances or is it just another form of work?

- The basis of the fiduciary management - is, first of all, collaborating attitude to owners of assets. There is nothing new in it, investors want to get profit, and we assist them in that. Our main asset - is a team of professionals that can, to my opinion, make any project at least breakeven, and in the long view to reach profitability.

- What do you think, is there any sense today to consider foreign assets?

- We are always looking towards getting profit. The only hindrance - is a political situation in the world. The general instability of political systems and rising strain in the world society - is a constraining factor today.

- What about trying yourself at the shelf?

- This is a prerogative power of large transnational companies. Such projects require very large investments at the beginning stage. We are not ready yet, but after a certain lapse of time - everything is possible.

- As we know, Rus Oil looks narrowly at the processing sector. What asset should it be and where?

- This asset should be, where there is demand for consumption of motor fuel and perspective of its growth.

- In your opinion, is it worth-while for small companies to try to become vertically integrated oil companies (VIOC) within their scope today? In due time, you have been one of developers of the industry restructuring, and of such companies actually.

- I have always been a follower of transition from the commodity-driven, low-added-value form of business to the integrated structure. Notwithstanding a number of considerable differencies, both in the form of ownership, and in the structure, VIOCs are united by one common sign - activity along the whole chain of the production process: geological exploration, oil fields development, oil production, processing into finished products and selling of products to consumers (wholesale and retail). We discuss it all the time, but everything is good in its season.