RusEnergy

02.15.2005 By Sujata Rao Reuters - Russian oil companies must embark on more exploration and production from new "greenfield" oil sites if they are to sustain the rapid production growth rates of recent years, analysts say. Russian crude output growth especially is showing signs of tapering off -- bad news for a world in which production capacity is already stretched because of rapid demand growth and slow progress on new ventures in the OPEC cartel. Russia's tremendous production growth this decade has been driven principally by "brownfield" rehabilitation of existing fields, which allowed some firms like Sibneft and Yukos to grow output by over 20 percent per year. Overall oil production has risen 50 percent since 1999. As firms concentrate on squeezing out every last drop from old sites, exploration spending has stagnated, and companies' production targets for 2005 are much lower than in past years. The International Energy Agency says future Russian capacity additions would have to come from new greenfield developments such as those in Eastern Siberia...