Due to sanctions, oil production under the Russian Sakhalin-1 project decreased by 22 times

This will affect the state of the economy of the entire Far East and the Russian Federation as a whole.

Russia is forced to cut oil production / photo ua.depositphotos.com
Russia is forced to cut oil production / photo ua.depositphotos.com

Due to sanctions against the Russian Federation , oil production within the framework of the Russian Sakhalin-1 project has decreased by 22 times – to 10,000 barrels per day.

This was stated by Deputy Prime Minister – Plenipotentiary Representative of the President of the Russian Federation in the Far Eastern Federal District Yuri Trutnev, writes the Russian  “Interfax”.play video

He noted that this affected the state of the economy not only in the Sakhalin region. The decline in oil production was felt by the entire Far East and Russia as a whole.

“It will not be received (to the budget of the Sakhalin region – ed.) in 2023 up to 38 billion rubles. This is 26% of the level of the region’s own income in 2022,” Trutnev said.

According to him, due to downtime, not only budget losses occur, but also deterioration in the characteristics of deposits. This will further affect the reduction of the oil recovery factor.

“This means that a large amount of oil will remain in the reservoirs,” explained the plenipotentiary of the President of the Russian Federation in the Far Eastern Federal District.

Trutnev also commented on the departure of foreign partners in Sakhalin projects. He noted that maintaining the PSA regime (production sharing agreement) is of fundamental importance for the budget of the Sakhalin Region.

According to the publication, of the three projects operating under the PSA with the participation of foreign capital, Sakhalin-1 was the leader in terms of production decline. 

As UNIAN reported earlier, on May 31, EU leaders agreed on the sixth package of sanctions against Russia, which provides for a significant restriction on oil imports from Russia.

On June 27, it became known that the leaders of the G7 countries are close to setting limits on prices for Russian oil.

(C)UNIAN 2022

One comment

  1. Is Sakhalin Island a permafrost region? If Russia can’t keep the oil moving through permafrost, it destroys the well and it must be redrilled. That happened at the supposed fall of the USSR and they got back to full production only last December.

    Liked by 1 person

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