ZAGREB, May 23 (Hina) - Croatia's oil company INA will produce 640,000 tonnes of crude oil in its two oil fields in Siberia - Western Varjogan and Tagrinka - this year. Next year, the firm "White Nights (Bijele Noći)", which is in
total ownership of INA, may produce 1.2 million tonnes of oil, which presents the overall annual production of oil fields in Croatia. As the drilling for this fuel is on the decline in Croatia's fields, INA has ensured its future by the purchase of the "White Nights", said the director of INA office in Moscow, Pavao Uroda, during last week's meeting with Croatian reporters in the Russian capital. INA's director-general, Davor Stern, described the buying of this foreign company, as a shift in the Croatian firm's strategy from research which in the past fifteen years had yielded slim results, while one billion dollars had been spent only to find gas in the Ivana
ZAGREB, May 23 (Hina) - Croatia's oil company INA will produce
640,000 tonnes of crude oil in its two oil fields in Siberia -
Western Varjogan and Tagrinka - this year.
Next year, the firm "White Nights (Bijele Noći)", which is in total
ownership of INA, may produce 1.2 million tonnes of oil, which
presents the overall annual production of oil fields in Croatia.
As the drilling for this fuel is on the decline in Croatia's fields,
INA has ensured its future by the purchase of the "White Nights",
said the director of INA office in Moscow, Pavao Uroda, during last
week's meeting with Croatian reporters in the Russian capital.
INA's director-general, Davor Stern, described the buying of this
foreign company, as a shift in the Croatian firm's strategy from
research which in the past fifteen years had yielded slim results,
while one billion dollars had been spent only to find gas in the
Ivana field in the northern Adriatic, to the purchase of the
confirmed oil reserves abroad.
In November 1998, INA bought for 19.64 million dollars the
American-Russian firm "White Nights" which has the licence for the
production of oil in the two aforementioned fields in Siberia.
According to estimates of INA experts, the proved reserves on these
two sites amount to 10 million tonnes. With the price of 15 dollars
per barrel on the world market, the value is 1.1 billion dollars.
Apart from the political and economic situation in Russia, the oil
price on the world market is also a prerequisite for the successful
investment into the "White Nights" company.
Investments in oil are long-term and risky, susceptible to effects
of changes in prices on the world market, Stern told Hina.
When INA was buying "White Nights", the oil price of less than 10
dollars per barrel was the lowest in the last 20 years. The price of
some 10.5 dollars per barrel is the price which may ensure the
survival of White Nights, according to INA estimates.
The price of 11.4 dollars would make positive effects and lead to
normal operations as well as cover investments in this firms, Stern
maintained.
According to the director-general, the entire enterprise of buying
the White Nights firms was planned in anticipation of the average
price of 15 dollars per barrel. Such price, and the current one is
higher for a dollar, helps bring profits and cover the investment.
For this year, INA is planning to invest 50 million dollars in the
White Nights, and one third of the amount will be earmarked from the
income of the former American-Russian company. The investment
should help increase the daily production on the Western Varjogan
field from the current 1,000 tonnes of oil to over 2.400 tonnes.
The crude oil from Siberia is being refined in Sisak, a Croatian
town 50 kilometres south-east of Zagreb.
Since the start of INA's production in Siberia at the end of
February, the Sisak refinery has refined 140,000 tonnes. The
transport of oil by the 7,000-kilometre-long "Druzba I" oil pipe-
line begins in the very fields.
Some 6,000 kilometres far from the Croatian capital, a dozen
Croatian workers, along with 720 Russian nationals, are being
employed in these fields.
(hina) ms