Russian oil giant posts record 2012 profit
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MOSCOW, Feb 1 AFP
February 02 2013, 05:06AM
Russia's state oil giant, Rosneft, has reported a record annual profit of $US11.4 billion ($A11 billion) ahead of a year in which output should double thanks to the acquisition of BP's local joint venture.
The stellar 2012 results from the company, Russia's biggest producer of crude, capped a busy 12 months in which it also struck a joint venture with the gas exploration firm Itera that is aimed at conquering untapped Arctic reserves.
Chief executive Igor Sechin - a confidante of President Vladimir Putin who structured the $55 billion TNK-BP deal - said on Friday Rosneft was fast becoming the world's largest energy firm.
He particularly pointed to the progress Rosneft had made in moving beyond its traditional Siberian production base by striking offshore deals with firms such as the US super-giant ExxonMobil and Norway's Statoil.
"Our efforts have made projects offshore on the Russian shelf a reality underpinned by investments by Rosneft and its strategic partners," Sechin said in a statement.
"We plan to maintain this pace moving forward with our strategy to further grow shareholder value reflecting the company's true potential."
The government had earlier on awarded Rosneft the right to explore 12 new fields in the Arctic previously eyed by private players such as Lukoil.
Sechin said on Thursday the TNK-BP deal would nearly double the company's oil production to 4.3 million barrels per day from 2.5 million barrels per day in 2012.
The deal with Itera has led to natural gas production climbing 25.1 per cent on the year.
The company's fourth-quarter profit shrank by 68.5 per cent because of the one-off difference with a third quarter in which Rosneft booked its Itera reserves and other gains.
Rosneft's 7.2-per cent rise in profit came in a year in which Russia recorded a post-Soviet oil production record and outpaced previous leader Saudi Arabia.
Putin's energy strategy has focused on consolidating Russian growth around two dominant champions: Rosneft and its state-held natural gas counterpart, Gazprom.
Rosneft in particular has enjoyed a decade of rapid growth that in 2012 saw it secure deals that will see it control about 40 per cent of the country's total production market.
Sechin told Putin this week his company's market capitalisation had risen to $92 billion.
Yet analysts worry less about the market capitalisation of Rosneft - the majority of its shares are still held by the government - than they do about its strategy after the acquisition of TNK-BP.
By Dmitry Zaks