RusEnergy

MOSCOW, March 16 (RIA Novosti) - The president of Russia's Union of Oil and Gas Industrialists has called for developing new deposits. If the government and the public do not change their attitude to the fuel and energy sector as a lifesaver that does not need investment and modernization, Russia will not be able to export oil soon, and oil will only be used for domestic consumption, union president Gennady Shmal said at the union's 6th congress. "The only way out is a major geological survey and the development of new oil fields, including unique ones like Samotlor (Western Siberia)," Mr. Shmal said. According to Mr. Shmal, Western Siberian fields will be the most important in the next 15-20 years. Developing oil fields in Eastern Siberia and the Far East will help ensure the country's strategic security, energy supply, economic development and geopolitical objectives, he said. Exporting oil from fields in Sakhalin and building a pipeline towards the Pacific coast are the immediate objectives for the country in the oil and gas sphere. Mr. Shmal said about a quarter of oil wells had been idle in Russia. For example, 12% of Surgutneftegaz's wells, 19% of LUKoil's, 30% of Yukos', 38.7% of TNK's and 56.5% of Sibneft's are idle. Amending the current law and adopting a law that will encourage oil production at low productivity fields will help resolve the problem, he said. Mr. Shmal also urged a solution to the problem of financing geological prospecting. "This issue has not been settled yet. It is not clear whether a centralized source will provide financing or this will only be oil and gas companies' prerogative," he said, noting legislation on production sharing agreements needs improvement. A balance of interests needs a better legislative foundation to ensure the state's strategic interests and guarantees to investors so that companies will boost investment in geological survey, he said.