Rosneft’s Income Slides Despite Gas Production Doubling

Rosneft’s net income for the first quarter registered a 13.7% year-on-year decrease, despite a simultaneous boom in gas production.

‘In Q1 2014, crude oil and liquids production (including production of subsidiaries and proportionately consolidated entities, and the share in production by affiliates) reached 4,189 th. bpd (0.5% growth year-on-year), gas production reached a record-high level of 13.18 bcm (i.e. more than doubled),’ reads a note released by Rosneft on Wednesday.

The financial result is related to the forex losses, due to Rouble’s fall to an all-time low against US dollar. 

‘The forex losses were primarily generated by revaluating foreign currency loans and borrowings and were partially compensated for by revaluating the forex position in cash, financial assets and accounts receivable,’ the company wrote in the press release. 

Rosneft bet on optimization and new fields to overcome present difficulties.

‘Under its assets optimization program, the Company closed a deal to sell a 49% stake in LLC Yugragazpererabotka to SIBUR in March 2014 and signed long-term associated petroleum gas supply and dry gas purchase contracts with SIBUR. These contracts, among others, will help maintain APG utilization in the Company’s assets in the Khanty-Mansi Autonomous Area in the long term (through 2032),’ reads the communiqué.