TNK-BP's Investment Planned to Exceed US$ 1 Billion in the Next Five Years
20 Apr 2004

Investments of the Russo-British petroleum company are planned in the amount of over US$ 1 billion annually in the next five years, said BP's President Sir John Brown speaking at the annual Russian Economic Forum in London. In his words, the company's investments will reach US$ 1.3 billion in 2004. John Brown also noted that TNK-BP's reserves are now estimated at 9 billion barrels of oil and are planned to be brought to 17 billion barrels in the future. The recovery level for the company's reserves will make 70% in 2004, and the idea is to bring this parameter to 100% in the future, according to Mr. Victor Vekselberg, Managing Director, Production and Technologies, TNK-BP. It was earlier announced that TNK-BP was planning to channel US$ 847 million to crude output and US$ 132.7 million to prospecting in Russia in 2004. TNK-BP plans to engage an independent auditor, DeGolyer and MacNaughton, to evaluate the company's reserves as of the end of 2003, said TNK-BP's Vice President Robert Dudley earlier. At present, proven crude reserves of the company, based on the evaluation under the standards of the Petroleum Engineers' Society, come to approx. 10 billion barrels. TNK-BP's reserves may rise at the expense of probable ones to 17 billion barrels in the mid-term, and at the expense of possible ones, to 25 billion barrels in the long-term. In 2003, crude output by the company came to 1.27 million bbd, which exceeds the 2002 parameter by 14%. BP and TNK's shareholders (Alfa Group and Access/Renova, AAR) that hold 97% of the company's shares signed the agreement to establish TNK-BP in February 2003. AAR contributed its stakes in TNK International and SIDANCO, stakes in RUSIA Petroleum, a gas deposit developed by Rospan in Eastern Siberia, and in the Sakhalin-6 project to the new company. ВР transferred a stake in SIDANCO, RUSIA Petroleum and in a Moscow-based chain of trademark retail stations to TNK-BP. Later on, the parties agreed upon incorporation of 50% AAR's stake in Slavneft into TNK-BP, for which BP paid US$ 1.4 billion to them. ВР and AAR announced that the transaction to established the consolidated TNK-BP was finalized on August 29.

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TNK-BP

TNK-BP is a major, vertically integrated Russian oil and gas company. In 2007, average daily oil production totaled 1.6 million barrels per day (excluding a 50% interest of Slavneft). TNK-BP operates five refineries (four in Russia and one in Ukraine) and nearly 1,600 branded retail outlets across both countries.

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