OREANDA-NEWS. September 06, 2010. Preliminary 8M10 operation results for Russia’s oil and gas sector were posted by CDU-TEK. According to their data, Russian oil output increased by 2.6% to 335.1 MMT (10.11 MMBOED) from January through August compared with the same period of 2009, reported the press-centre of OTKRITIE Financial Corporation.

In 8M10, Russian crude oil exports rose 3.7% YoY to 145.8 MMT, while gas production in Russia climbed 17% for the same period. For August, oil output increased 0.9% YoY, but declined by 0.8% compared to July. Production growth for 8M10 was led by Rosneft (+5% YoY; 74.5 MMT), TNK-BP (+3% YoY; 47.8 MMT), and Bashneft (+16.4% YoY; 9.3 MMT).

The oil production increases posted by these companies were a function of the stabilization of oil output at brownfields and the expansion of production in greenfields, where the companies have been employing high-tech equipment and methods. By contrast, LUKOIL (-1.78%; 60.6 MMT) and, Surgutneftegaz (-0.9%; 39.4 MMT) saw decreased production. Gazprom neft (19.8 MMT) and Tatneft (17.4 MMT) maintained production at last year’s level.

View: We believe this data will not significantly impact the shares of Russian oil and gas companies because this production growth has to a large extent already been factored into prices. Nonetheless, we believe these statistics bode well for Bashneft, Rosneft and TNK-BP, as such strong volume growth implies strong financials for FY10.