* Oil production up 0.4 pct from July
* Oil output at Rosneft's Vankor field jumped 12 percent
* Analysts say tight oil is the next source of growth
* Gas output stops sliding, stays unchanged at 1.45 bcm
By Vladimir Soldatkin
MOSCOW, Sept 2 Russia extracted oil at a record pace of 10.38
million barrels per day in August, a level unseen since the collapse of the
Soviet Union, as companies took advantage of high oil prices, Energy Ministry
data showed on Sunday.
Rising production will be welcomed by the administration of President
Vladimir Putin, who embarked on a social programme spending spree prior to his
election campaign and return to the Kremlin in May. Oil and gas sales account
for about half of state revenues.
Russian oil output, the world's largest, edged up 0.4 percent in August from
10.34 million bpd in July. In tonnes, the ministry said crude production in
Russia stood at 43.89 million last month.
The previous record level of 10.36 million bpd was reached in the first
three months of this year.
Russia aims to maintain crude production of no less than 10 million bpd
within the next 10 years. Last week, Russia's Economy Ministry raised its
forecast for 2012 oil production to 514 million tonnes (10.3 million bpd) from
its previous 510 million-tonne projection.
Russia remained the world's top crude producer, ahead of quota-bound Saudi
Arabia, which produced 9.95 million bpd last month.
In August, oil prices jumped 9.2 percent, the biggest monthly
percentage increase since prices rose by 10.5 percent in February, and extended
a 7 percent rally in July as a result of tension over Iran's nuclear programme,
and hopes of more monetary easing that could spur economic growth and support
Oil producers in Russia benefited from the European Union's embargo on
imports from Iran, which started in July. Russian, Iraqi and Saudi crudes have
been the main grades to replace Iranian oil since the sanctions were imposed.
Russia is hunting for new sources of oil in East Siberia and the Arctic as
production in West Siberia falls due to highly depleted deposits. Analysts say
next year's production should be lifted by Gazprom's Prirazlomnoye
deposit - the first Arctic offshore field, which Russia is about to start
Another source of crude production growth in Russia is "tight oil", hidden
between layers of rock and mostly untapped.
Russian companies have increased drilling tight oil reserves in expectation
of tax benefits, said analyst Valery Nesterov at brokerage Troika Dialog.
"The Russian government is closely monitoring the oil industry. It is doing
everything so Russia remains a leader in crude production. Tight oil is the next
large contributor into overall oil output growth," he said.
Russia's tight oil potential was highlighted earlier this year when
ExxonMobil, as part of its agreement with Rosneft, brought the
Russian state oil company into two unconventional projects in North America as a
means of exposing to Rosneft to drilling techniques it might use in Siberia.
Rosneft estimates it has about 2.5 billion tonnes of unconventional oil
reserves trapped in the Bazhenov formation in its West Siberian fields.
Last month, oil output at Rosneft, Russia's top crude producer, exceeded a
monthly level of 10 million tonnes (2.36 mln bpd) for the first time as a result
of a 12 percent increase at its new Vankor oilfield in East Siberia.
Russia's No.2 oil producer, LUKOIL, which expects its output to stabilise in
2012 after years of decline, increased production last month by 0.5 percent to
1.7 million bpd, boosted by improved results at its West Siberian units.
However, oil output at Anglo-Russian company TNK-BP fell 0.5
percent as production increases at its new Uvat and Verkhnechona fields failed
to offset slowdown at its Samotlor and Orenburg subsidiaries.
Daily gas production in Russia halted its slide, staying unchanged
month-on-month, at 1.45 billion cubic metres (bcm) in August.
Production at world's top natural gas producer Gazprom increased 0.4 percent
to 1.03 bcm.