Rosneft profit soars thanks to booming gas output

Russia's oil giant Rosneft reported a 51-percent jump in annual profit on Tuesday thanks to a huge boost in natural gas output that made it the country's third-largest producer. The state-held firm -- the world's biggest publically-traded oil company by both production and reserves -- said its 2013 net income reached 551 billion rubles ($15.6 billion, 11.5 billion euros). The company said its total hydrocarbon production grew by 80.3 percent thanks to a 132.9-percent leap in natural gas output. "The 2013 performance has made Rosneft the third-largest gas producer in Russia with increased gas production to 38.17 billion cubic metres," the company said in a report. Rosneft attributed its strong natural gas performance to last year's acquisition of the private Anglo-Russian venture TNK-BP along with the assets of the Itera energy group. Rosneft is run by President Vladimir Putin's long-time confident Igor Sechin and has long set its sights on cutting into Russian rival Gazprom's huge advantage in natural gas. The company now plans to also enter the liquified natural gas market by building an LNG plant in Russia's Far East under an agreement signed in 2013 with the US super-major ExxonMobil. Last year "was a transformational year in the company's history," Sechin said in a statement. "We are proud to say that on a number of metrics...the company’s results are the best not only in Russia, but also on a global scale." Sechin added that Rosneft this year is preparing to launch "new major projects" whose details he did not disclose. Russia's world-topping crude output hit a post-Soviet record of 523.3 million tonnes (10.51 million barrels per day) last year. But analysts worry that about 90 percent of that production comes from fast-depleting fields in West Siberia that were first developed in the Soviet era. Rosneft said production at new fields in East Siberia now accounted for 19 percent of all liquids -- an encouraging statistic that is watched closely by investors because of its importance to future output. The firm added that output in older fields was improving thanks to new technology made available through tie-ups with ExxonMobil, Italy's ENI and Norway's Statoil. Rosneft also said that a recent audit raised its proved hydrocarbon reserves by 74 percent to 33.00 billion barrels of oil equivalent on the basis of standards set by US regulators.