Russia tapping deeper into Arctic oil basin

April 13 (UPI) -- Russian oil company Gazprom Neft said it finished drilling a new production well at one of its flagship fields above the Arctic Circle.

The company said it finished the well in part of the Novoportovskoye field. The new prospect is currently at a rate considered commercial and "is expected to deliver approximately 25 percent of all oil produced at the Novoportovskoye field over the next three years, and more than 10 percent of all oil produced at Novy Port over the course of its productive life," the company said in a statement.

The field is located above the Arctic Circle and far away from any pipeline infrastructure. Pilot projects were completed in 2014 and shipments facilitated by an icebreaking-vessel made it so the company could start delivering oil from the extreme north about a year ago.

A subsidiary of Gazprom Neft reached a milestone last year with the production of its 10 millionth barrel of oil at the northern Prirazlomnoye field. The company revised its production schedule higher after a review of data found annual peak production rates could reach 35 million barrels.

Development of the fields above the Arctic Circle is costly, with most Russian operators waiting for oil to move above $75 per barrel to review further opportunities.

Russian Minister of Natural Resources Sergei Donskoi said last month that, while the market was prohibitive of further development, the Arctic region was still a strategic development opportunity.

"Like most experts, I am sure the unique deposits, playing key roles in the global balance of reserves, are bound to be opened exactly there," he said.