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Financial Times: Siberia oil field helps Sibir lift output by 80%

By Toby Shelley
Published: February 7 2008 02:00 | Last updated: February 7 2008 02:00

Sibir Energy increased oil production in 2007 by 80 per cent as output increased at the Salym field in western Siberia where it partners Royal Dutch Shell.

The group said production rose to 48,900 barrels a day, with a year-end rate of 63,100 b/d. A further 40 per cent increase is forecast for 2008.

The oil exploration and production company, which is majority-owned by Russian businessmen, also increased the annual volume of crude processed on its account at the Moscow Refinery by 51 per cent to 21.4m barrels. This is seen rising to 35m barrels in 2008.

Last year Sibir said it would move from Aim to the London main list and this is expected to happen in the second half of this year.

The group is also optimistic that it is moving towards resolution of long-running tussles that have dogged it in recent years.

When Gazprom acquired Sibneft from Roman Abramovich in 2005 the statecontrolled energy group inherited a troubled relationship with Sibir, including a dispute over control of the Moscow Refinery and a bitter row over the dilution of Sibir’s stake in the South Priobskoye oil field.

Last summer Sibir looked set to solve the issue by creating an enlarged company with Gazprom containing the disputed assets. However, last month a new way forward was announced with the two companies agreeing a restructuring of the board of Moscow Refinery.

Discussions over the oil field stake are continuing but in November the matter passed into the hands of the English Commercial Court when the Provisional Liquidator was granted powers to issue proceedings against Mr Abramovich and his one-time partner Boris Berezovsky.

Sibir shares in London rose 4p to close at 427p yesterday.

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