The huge western Siberian basin, which Moscow had counted on to ensure rising Soviet petroleum production into the next century, is instead leading the sharp decline in the former U.S. S. R.'s total oil flow.
New data indicate that western Siberia's 1991 crude and condensate production fell to less than 6.5 million b/d. That's down from nearly 7.5 million b/d in 1990 and a peak of 8.28 million b/d in 1988.
Western Siberia's 1 million b/d oil production plunge last year represented more than 70% of the former Soviet Union's unprecedented production loss of about 1.4 million b/d/year (OGJ, Dec. 30, 1991, p. 24). Moscow press reports say western Siberia's 1992 crude and condensate flow is likely to slide again to little more than 5.5 million b/d.
Such low production would make it difficult for Russia to meet the oil needs of other members of the new Commonwealth of Independent States, let alone earn substantial amounts of desperately needed hard currency from crude and refined products sales to foreign countries.
FAILED PREDICTION
The precipitous fall in western Siberian oil flow has stunned Russian officials and surprised most foreign observers. Moscow authorities had predicted western Siberia would be able to produce at least 10 million b/d by the 1990s and could sustain that level through 2000 at least.
But Soviet statements that the western Siberian basin virtually floats on a sea of oil have been muted during recent years. So have assertions that the area's reserves are comparable to Saudi Arabia's.
Nevertheless, it seems certain that any reversal of the former U.S.S.R.'s oil production decline by the mid-1990s depends on western Siberia. Neither Kazakhstan, with its supergiant but still unproductive Tengiz field, nor eastern Siberia, nor promising offshore areas in the Caspian Sea and on Sakhalin Island's coastal shelf in the Sea of Okhotsk appear capable of making a major contribution to the new commonwealth's oil flow during the next 3-4 years.
If foreign capital investment and advanced technology are not liberally provided for western Siberia's petroleum industry, even that region's oil production prospect likely will remain bleak during the foreseeable future.
There are only two reasons for limited optimism in the latest projections for western Siberia's petroleum industry performance this year:
- Besides the possibility of a slightly smaller oil production decline than in 1991, natural gas flow should continue its string of annual gains that has lasted nearly three decades.
- The anticipated growth of foreign assistance in developing new fields and stimulating yields from existing wells probably can't stem western Siberia's oil production slide before 1995, although annual declines should slow significantly if Russia's economy doesn't collapse.
It's estimated that western Siberia provided more than 595 billion cu m (21 tcf) of gas last year, a record high. The area's gas flow was up from about 575 billion cu m (20.3 tcf) in 1990, 538 billion cu m (19 tcf) in 1989, and 511 billion cu m (18 tcf) in 1988.
Western Siberia's share of total Soviet gas production has risen steadily since 1970, when the basin's flow was less than 10 billion cu m (353 bcf). On the other hand, annual hikes in western Siberian gas volume have plummeted from about 30 billion cu m (1.77 tcf) in 1985 to 20 billion cu m (706 bcf) in 1991.
Total gas flow from other areas of the former U.S.S.R. dropped last year.
Total oil flow from the 12 former Soviet republics that now make up the new commonwealth is not expected to dip below 8 million b/d during the 1990s under any but the worst scenarios.
OTHER AREAS
Russia's present oil production woes extend to other major petroleum areas.
In the Volga-Ural region, the U.S.S.R.'s biggest crude producer in the 1960s and through 1977, production apparently has fallen to about 2 million b/d vs. a high of 4.52 million b/d in 1975.
The Komi Autonomous Republic in the far northeast sector of European Russia was expected to boost oil production close to 500,000 b/d by 1990. Instead, production peaked at about 400,000 b/d in 1986 and has now dropped to less than 300,000 b/d.
As in western Siberia, joint ventures with foreign firms are expected to slow declines in Volga-Ural and Komi crude and condensate flow during the next several years.
Western Siberia's marshy petroliferous basin covers nearly 550,000 sq miles. It is almost as large as Alaska and is twice as big as the Volga-Ural oil region.
TYUMEN CLOUT
Tyumen Province, which occupies western Siberia's northern sector, accounted for more than 95% of the basin's crude and condensate production last year. Tomsk Province, lying south and east of Tyumen and less than one-fourth as large, provides the remaining production.
Relatively small oil discoveries have been made in Novosibirsk and Omsk provinces in the southern part of the western Siberian basin. But they have little, if any, crude or condensate production.
Tyumen Province's commercial oil production began in 1964. Tomsk Province started commercial production in 1966.
Official reports show that Tyumen crude and condensate flow jumped from about 2.83 million b/d in 1975 to nearly 6.1 million b/d in 1980, more than 7 million b/d in 1985, and a high of a little less than 8 million b/d in 1988. Production then fell to 7.68 million b/d in 1989, 7.2 million b/d in 1990, and an estimated 6.2 million b/d in 1991.
Projected Tyumen 1992 oil production is only 5.26 million b/d, the lowest since 1978.
Moscow News recently disclosed that the average yield of Tyumen's more than 57,000 wells during 1990 was 125.6 b/d. That's down sharply from more than 196 b/d in 1985 and 284 b/d in 1980.
Even so, the yield of Tyumen wells still greatly exceeds the average for all wells in the former Soviet Union.
SAMOTLOR SUPERGIANT
All of Tyumen's biggest oil fields now have either declining or stagnant production. Supergiant Samotlor, discovered in 1965 and on stream since 1969, has experienced an especially steep production slide during the past 10 years.
The largest oil field discovered in the former U.S.S.R., Samotlor achieved maximum flow of 3.1 million b/d in 1980.
A report in the newspaper Ekonomika I Zhizn (Economics and Life) indicated that the entire Nizhnevartovsk Oil and Gas Association, which includes Samotlor and satellite fields, is producing less than 1.4 million b/d of crude and gas liquids.
Nizhnevartovsk officials expected the association's 1991 oil flow to be at least 220,000 b/d short of the central government's plan. Besides difficulties caused by shortages of drilling, production, and workover equipment, the Samotlor district is losing significant volumes of oil as a result of numerous leaks in gathering lines long overdue for replacement.
Total deliveries of equipment and materials to the Nizhnevartovsk association were only 40-60% of requirements last year, local officials complained.
TOMSK DISAPPOINTMENT
Meanwhile, Tomsk Province, where crude and condensate flow was slated to reach nearly 400,000 b/d by 1985, continues to be a major disappointment.
Production rose from about 130,000 b/d in 1975 to nearly 200,000 b/d in 1980 and more than 260,000 b/d in 1985. But flow topped out at 300,000 b/d in 1987-89.
Pravda reports Tomsk oil production fell almost 20,000 b/d to 275,000 b/d in 1991 "and in all probability will drop further in 1992."
Until the late 1980s at least-and probably even now-giant Sovetskoye field produced most Tomsk Province oil. Lying near the Ob River southeast of Samotlor, Sovetskoye production apparently peaked at close to 200,000 b/d.
Many more Tomsk fields were discovered in the late 1960s, 1970s, and 1980s. But none was comparable in size to Sovetskoye, and development of reserves in the huge Vasyugan swamp area south of Sovetskoye has lagged badly.
At present, Pravda said, development of new Tomsk fields is almost at a standstill because the province's oil association is essentially bankrupt.
Tomsk oil reserves rose by 10 million metric tons (73 million bbl) during the first 10 months of 1991, Pravda reported. But three fields capable of producing more than 100,000 b/d are not being developed because funds are not available.
If financial difficulties aren't overcome, Tomsk exploration as well as development will suffer still more in 1992, province officials said.
Biggest obstacle for the Tomsk oil industry, as it has been in other Soviet petroleum producing areas, is that until recently the province has been forced to sell nearly all its crude to the central government at artificially low fixed prices which permitted little or no profit.
Meanwhile, prices for oil field equipment were allowed to soar.
Pravda said more than 900 Tomsk Oil Association wells were idle last November.
EQUIPMENT MONOPOLY
Monopoly conditions still prevail in the former U.S.S.R.'s petroleum equipment industry. Almost all oil production hardware is manufactured by plants in strife torn Azerbaijan and in the Grozny district, also plagued by unrest.
Equipment deliveries from Azerbaijan to western Siberian oil associations have practically stopped, while shipments of Grozny made equipment have been sharply reduced.
Enormous prices are being demanded for what little equipment is being offered, Pravda declared. The newspaper added that if the Tomsk Oil Association were allowed to sell even a small part of its oil production on the free market at world prices, the region's workers would be able to buy what they need rather than remain dependent on the government for nearly all supplies.
Pravda hailed indications that this problem is at last being solved. It reported that authorities have given the Tomsk Oil Association a license to export 100,000 tons of crude.
"This may mean that the government will stop forcing Tomsk oil personnel to work with tied hands," Pravda said. "Possibly the ice has broken, and there will again be gasoline at Tomsk filling stations."
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