Russia have enough oil just for another 28 years, said domestic Minister for Natural Resources

According to the Minister for Natural Resources and Ecology of Russia, Sergei Donskoi, Russia’s discovered oil reserves stand at about 29 billion tons [those which could be theoretically extracted from the subsoil]. Russia produced 505 million tons of crude oil in 2015. If we consider these figures, the open reserves will be enough for 57 years. He confirmed that known oil reserves are enough to provide a yearly extraction of oil for the next 28 years only.

At the same time, he added that the volume of proved reserves is only about 14 billion tons.” “The already discovered resource base will be enough to provide for the yearly extraction for the next 28 years,” the head of Ministry of Natural Resources stressed.

He also pointed out that “the proportion of stranded oil is increasing”. “Its development is associated with low economic efficiency and requires the development of technologies,” the minister said, admitting that “without new discoveries the extraction of traditional reserves will start to decline from 2020”.

“That’s why we have no plans to stop exploration projects,” Donskoi stressed.

He said that the work “to establish special sites for development of unconventional hydrocarbon resources” will be continued. According to the minister, such sites have already been created in the Tomsk region, the Khanty-Mansi Autonomous District and Tatarstan.

“We are also working on the possibility of providing companies with underlying beds with stranded oil under already existing licensed sites. In addition, a new classification of oil and gas reserves will contribute to the development of resources whose production is problematic,” he said.

The Vice-rector at RANEPA Andrey Margolin said in conversation with a correspondent of Vestnik Kavkaza that even taking into account data provided by Donskoi, not all the sources are exhausted in the production and extraction of oil. “For example, the Americans launched the shale oil industry not so long ago, probably we have a similar opportunity. Besides, oil is not the only source of our energy balance, we can develop alternative energy sources. We should be engaged in resource efficiency, processing of oil and, of course, developing the non-raw material sectors of economy with high added value,” he urged.

A key factor here is the exploration for oil resources. “In no way could the exploration works be ended. Perhaps while searching for oil we will find something else. It seems to me that the economic problems must be approached comprehensively. Russia’s territory is very large and we have no philosopher’s stone that would solve all our problems at once,” Andrey Margolin noted.

The director of the Center for Studies of World Energy Markets at the RAS Institute of Energy Research, Vyacheslav Kulagin, in his turn, recalled that two decades ago, Russia’s proven oil reserves were enough for the next 10 years only. “Many years have passed since then, but we still have oil resources. Moreover, the Energy Ministry’s report in 2015 showed a growth in stocks over the past few years. In general, the increase in reserves is even slightly higher than the level of production, so the problem is different: these stocks are becoming more complex. There are always new technologies to handle it: I remind you that 30 years ago no one would have started to develop those fields that are being developed today. And the technology, which will allow to develop those complex and expensive reserves, will be created in 30 years as well,” he said.

“A good example here are shale oil and gas projects. Everyone knew about these stocks 20 years ago, but no one worked there, and today they are successfully developed and are quite competitive on the market. The same thing will happen in Russia in the future. So there is no such problem as running out of oil. There are other issues now, for example, the cost of extracting oil will be $200 per barrel at some fields with the current technologies,” Vyacheslav Kulagin concluded.