Production from OPEC-member Iraq helps Russian oil company Gazprom Neft realize gains during the first half of the year. Photo by cherezoff/Shutterstock
Aug. 10 (UPI) -- Russian oil company Gazprom Neft said its net production was up more than 5 percent from last year, driven in part by output from OPEC-member Iraq.
Gazprom Neft is the oil division of Russian energy major Gazprom. It's the fourth largest oil producer in Russia and said its first quarter production was about 160 million barrels of oil equivalent, a level that was 4.8 percent higher year-on-year.
Production during the first half of the year was 322.6 million barrels of oil equivalent, an improvement of 5.2 percent from the same period last year. As with the first quarter, the company said production gains were driven by its operations at three Arctic oil fields, as well as Iraq.
Total export volumes for the company increased 9.4 percent from the first quarter and 81 percent from last year because of production gains at its Arctic oil fields "and reduction of crude oil delivery to refineries."
Russia is party to a multilateral effort organized by the Organization of Petroleum Exporting Countries to balance an oversupplied market with managed production declines. Russia is the largest contributor among non-member states. Iraq, meanwhile, is viewed as the least compliant among OPEC members, though expressed "full support" for the agreement during a recent meeting in Abu Dhabi.
The effort helped support crude oil prices at around $50 per barrel, an improvement after last year's drop beneath $30 per barrel. Compliance and production from OPEC members Libya and Nigeria, who are exempt from the deal because of national security issues, have complicated the balancing effort.
Gazprom Neft reported net income for the first half of the year was up 23.1 percent from the same period last year at $1.8 billion.
"Gazprom Neft maintains a leading position in operational efficiency in the Russian oil sector, whilst continuing to consistently expand the scale and geography of its operations despite challenging market conditions," Chairman Alexander Dyukov said in a statement.