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Page added on March 24, 2016
Russia pulls 10 millionth barrel of oil from Arctic
Russian oil company Gazprom Neft said it reached a milestone with production at its Arctic Prirazlomnoye field with its 10 millionth barrel of oil.
“The 10-millionth barrel of oil is a major landmark, proving that oil production on the Arctic Shelf can be both safe and viable,” Gennady Lubin, the company’s executive director for operations on the Russian continental shelf, said in a statement.
Advocacy groups like Greenpeace have been critical about oil operations in the extreme climates of the Arctic north, saying an oil spill in the region would be catastrophic and difficult to control.
Gazprom Neft said a stationary rig at the site is designed specifically to ensure the risks of a spill are minimized to the greatest extent possible. Production, the company said, is planned around what it described as stringent environmental safeguards.
Last week, the company revised its production schedule higher after a review of data found annual peak production rates could reach 35 million barrels.
“We are pushing ahead with opening up the Prirazlomnoye field, with the production and shipment of hydrocarbons running to schedule,” Lubin said.
While most companies are scaling back under pressure from lower crude oil prices, the Russian oil company said it could do more with less given the revisions to production estimates from the Prirazlomnoye field.
Oil from the field is transported by two doubled-hulled tankers designed to ensure safe delivery from the Arctic north. Discovered in 1989, the Prirazlomnoye is roughly 35 miles from shore in the Pechora Sea.
26 Comments on "Russia pulls 10 millionth barrel of oil from Arctic"
Go Speed Racer on Thu, 24th Mar 2016 12:18 pm
Lik a hot fudge sundae, all that oil spilled all over the snow.
curlyq3 on Thu, 24th Mar 2016 12:26 pm
Howdy … if global oil demand is about 90 million barrels a day, then I divide 90 by 24 and get 3.75 million barrels an hour for global oil demand which means that Russia has extracted about enough oil from the Arctic to satisfy 2.66 hours of global oil demand … Jethro asks is this accurate ciphering ?
curlyq3
Davy on Thu, 24th Mar 2016 12:50 pm
Right Curley, insignificant in the greater scheme of things. I might add how much profit was made on those barrels?
Apneaman on Thu, 24th Mar 2016 1:20 pm
Davy’s emotions are hurt because Russia got some props.
Rob on Thu, 24th Mar 2016 2:20 pm
Let me know when it’s 10 billion
Apneaman on Thu, 24th Mar 2016 2:42 pm
The Arctic is thawing much faster than expected, scientists warn
https://www.washingtonpost.com/news/energy-environment/wp/2016/03/23/the-arctic-is-thawing-much-faster-than-expected-scientists-warn/
Apneaman on Thu, 24th Mar 2016 2:46 pm
Ice Melt, Sea Level Rise and Superstorms Video Abstract
https://www.youtube.com/watch?v=JP-cRqCQRc8
makati1 on Thu, 24th Mar 2016 7:09 pm
Ap. Russia is growing in power and influence around the world just as the Us is losing it’s influence and power. China is in the news because it holds America’s financial future in it’s hands and is also increasing in influence and power all over the globe. The Imperial Propaganda Mill is being tuned out by everyone except the gullible Americans.
Harquebus on Thu, 24th Mar 2016 8:11 pm
“So here’s what happened. Exxon used its knowledge of climate change to plan its own future. The company, for instance, leased large tracts of the Arctic for oil exploration, territory where, as a company scientist pointed out in 1990, “potential global warming can only help lower exploration and development costs.” Not only that but, “from the North Sea to the Canadian Arctic,” Exxon and its affiliates set about “raising the decks of offshore platforms, protecting pipelines from increasing coastal erosion, and designing helipads, pipelines, and roads in a warming and buckling Arctic.” In other words, the company started climate-proofing its facilities to head off a future its own scientists knew was inevitable.”
http://www.tomdispatch.com/blog/176105/tomgram%3A_bill_mckibben%2C_it%27s_not_just_what_exxon_did%2C_it%27s_what_it%27s_doing/
Rick Bronson on Thu, 24th Mar 2016 9:22 pm
Of late there are more days without snow in Arctic and this will help in more drilling.
So the question is: Will there be a day when there is no snow in the whole Arctic Ocean ?.
I don’t think Russians seems to be worried about. Neither are the drivers of gas guzzling vehicles.
Truth Has A Liberal Bias on Thu, 24th Mar 2016 9:40 pm
I dunno Davy…. how much profit was made on those barrels? Why don’t you tell is since you’re so fucking smart you fucking retard. You’re a typical American, and by typical I mean fucking retarded.
makati1 on Fri, 25th Mar 2016 1:01 am
Truth, As I have read elsewhere, Russia can recover oil at a cost under $10/bbl, a selling price of $30+ would be profitable. Ten million barrels would be a nice $200+ million profit. I bet American oil companies would like to make that kind of profit, or any profit. Anyone out there with any actual FACTS on Arctic oil costs in Russia?
rockman on Fri, 25th Mar 2016 6:38 am
First, you guys can pooh pooh the volume of oil. But that just shows you don’t understand the dynamics of oil exploration. Those 35 million bbls per year is a huge number these days. That’s about 100,000 bopd. Go find any other field that started up in the last 10 years that’s doing that rate today….you’ll find very few. Some of the old fields are doing that and better but that’s oil that has been on the books for a long time already. The Russian field is NEW oil. And yes: compared to consumption it’s not significant. OTOH with the exception of a few old megafields production from no one individual field on the planet is significant. Today’s oil production comes from hundreds of thousands of wells. Consider how excited folks got over the Eagle Ford wells. It would take about 100 of THE BEST EFS wells to match the current Russian production. But they would decline to almost half that rate in a year while the Russian production would keep going. And those 10 million bbls recovered so far? It would take about 50 of the average EFS to produce that much. Which means every year another 50 EFS wells would have to be drilled to keep up with the Russian cumulative production. Not sure what a legitimate reserve estimate might be for the Russian field so let’s assume it can hold the current rate for 5 years. That would take drilling about 250 EFS wells at a total cost of around $1.5 BILLION.
Second, a side note for Mak: remember it will cost $X/bbl to discover and develop a field. But once producing it takes much less than $X to produce a field. I won’t guess what the daily operating cost for that field might be. But let’s assume it’s $5.bbl. That would imply the field is costing the Russians more than $35 MILLION PER YEAR to produce that field. Granted they are operating in the most expensive environment but I doubt they are spending anything close to that amount. What they spent to develop the field is a sunk cost. Just a very rough guess so don’t hold me to it: the field could be generating almost $1 BILLION/YR in net revenue for the Russians.
And guess what? If there’s one field like this there are others yet to be discovered. Some smaller and some larger. That’s been then nature of frontier explorations since the oil patch began hunting over 120 years ago. If one doesn’t like the environmental risk of Arctic oil production that’s OK…lots of reasons to feel that way. But trying to minimize the value will only led one to underestimate future development of the Arctic Basin. The Russian have discovered and developed what looks like a decent commercial field. It won’t be the last. So that’s the battle ahead: profit motive vs environmental concerns. If one doesn’t appreciate the profit side of the equation they’ll not be able to construct viable approach. Greenpeace did their thing and now the Russian are producing tens of millions of bbls of oil in those waters. Raising a fist, climbing on the rig and saying nasty things about Russia changed nothing. You can’t win a war without winning at least some battles.
Davy on Fri, 25th Mar 2016 7:36 am
Folks pick apart this comment and tell me if anything intelligent was said?
Truth Has A Liberal Bias on Thu, 24th Mar 2016 9:40 pm “I dunno Davy…. how much profit was made on those barrels? Why don’t you tell is since you’re so fucking smart you fucking retard. You’re a typical American, and by typical I mean fucking retarded.”
What kind of English grammar is “Why don’t you tell is”. Typical foul mouth Canadian with the “fucking” word used constantly that is truly a stupid Canadian thAg. “You’re a typical American” that is a typical Canadian anti-Merikan thAng. “I mean Fucking retarded” how many times has liberal dumbass used “fucking” and “retarded”. What a looser.
Davy on Fri, 25th Mar 2016 7:45 am
Rock, the Artic is a dead end and one does not have to be a professional to realize this. We are likely at the end of the road of producing expensive oil. The Russian have made an achievement but surely at high cost. How many more profitable commercial fields are possible? Too hard to tell but the current economic environment points to significant headwinds for Artic production. The Russians are going to be hard pressed to maintain current fields and exploration levels let alone a big push into such a hostile environment. We are getting to the end of the road economically how close is debatable. If you acknowledge that and acknowledge the amount of time it will take to develop Artic reserves then you have to question a future for oil production there.
JuanP on Fri, 25th Mar 2016 10:56 am
On Russia’s economy, http://russia-insider.com/en/business/russian-economy-waiting-lower-interest-rates/ri13564
makati1 on Fri, 25th Mar 2016 7:26 pm
Rockman, you outlined it perfectly. Complaining will not stop the oil from flowing. Nor will any ‘environmental damage’. I would suspect that there has been a lot of ‘environmental damage’ in the Arctic from the Us’ own fields on the coasts. What right have we to point a finger at someone else? Just because we are not able to do the same? Oil will flow as long as it is profitable. When it is not, the wells will be shut down.
makati1 on Fri, 25th Mar 2016 7:33 pm
Good article JuanP. Shows that Russia has a lot of ammunition left in it’s financial arsenal. Not to mention the most natural resources to back them up.
Boat on Fri, 25th Mar 2016 8:02 pm
mak,
As much as you chat about Russia you should know their GDP is down, high interest rates and buying power down because of the ruble being down. If the US were in the same position you would say they were in collapse. Oh wait, you do anyway. Lol
makati1 on Fri, 25th Mar 2016 8:21 pm
Boat, and how is that different from the Us? I can tell you how. It means that there is still a lot of room for the Russians to move their economy. They can cut interest rates a long way before they get to the desperation levels our own Fed is enjoying at the moment.
The Us not so much. The Fed is at ZERO interest already. Nowhere to go but up, which will crash the system. The Fed is sucking up debt like a vacuum cleaner on high. That too will end disastrously. Nothing it can do will save the Us now. Nothing.
The Russians don’t need to bomb the Us to win. They just need to wait as it commits suicide.
Russia is doing just fine thank you.
Boat on Fri, 25th Mar 2016 8:43 pm
Yea, their small wages of $6,700 dropped $700 just this year.
Yea, I can buy a car or house for very little interest. The Russian factory worker will not be making large purchase any time soon.
Sometimes I worry about just how disconnected you are.
GregT on Fri, 25th Mar 2016 9:39 pm
“Yea, I can buy a car or house for very little interest.”
A prime example of the utter cluelessness that pervades American society. Vote for the Donald, or vote for the Clintons. At this point in time it no longer matters. Sheer stupidity reigns supreme.
The people always get the government that they deserve.
makati1 on Sat, 26th Mar 2016 12:43 am
GregT, Amen!
Boat, the Russian people know that they don’t NEED a big house or car, like Americans believe they do. Have YOU actually been to Russia lately? I doubt you have even been out of your state in the last 5 years. Russians are used to living a spartan life, yet they are still a happy people supportive of their government. Not so much Americans who put their leader and government into the low double or even single digits.
Davy on Sat, 26th Mar 2016 5:20 am
“Russians are used to living a spartan life” More Russian romance and naiveté. Some Russians live Spartan lives while others live very well. Oil has many perks if you are connected. Go to the south of Europe and the rich Russians are everywhere. Many other are engaged in criminal activity or IOW petty mafia. This is a way of life that ensures that many Russians live Spartan lives in fear. You have the rich Tycoon Oligarchs at the top feeding off everyone else. I love the Russophiles and there endless job of embellishing the Russians economy and culture.
There is plenty to admire about Russians and Russia but please spare me the empty embellishment of how the Russians are like the new master race. They suffer many bad cultural ills. Their population is in decline for a reason. Alcoholism, drug abuse, and broken families are all too common. Their economy is resource dependent and not diversified enough. The Russians even admit these problems and are trying to change it. The board Russophiles don’t want to see it because they see the Russians as the great opponent to the evil Merika.
JuanP on Sat, 26th Mar 2016 8:00 am
Boat “Yea, I can buy a car or house for very little interest.” are you not the one who claimed he lives with his extended family in the same house a while back? Have you ever in your life purchased a new car? If you are the same one, then you can’t afford the things you claim, if you aren’t, sorry for the confusion.
JuanP on Sat, 26th Mar 2016 8:08 am
Watch this video of US DOS spokesman. Can’t make this shit up! http://russia-insider.com/en/httpwwwzerohedgecomnews2016-03-25caught-tape-state-dept-says-maybe-russia-syrian-army-shouldnt-take