KRASNOYARSK, Russia (Reuters) - Russia’s Rosneft, the world’s top listed oil producer by output, has an opportunity to boost its market share if there are shortages on the global oil market, Chief Executive Igor Sechin said on Thursday.
Rosneft, with BP and Qatar among its shareholders, accounts for around 40 percent of Russia’s total oil production and is key to Moscow sticking to its commitments under the global oil output cut deal by OPEC and some non-OPEC countries.
“Today, the market is quite united in expectations of the structural oil deficit in the next 10 years, as growing demand comes along with a fall in production,” Sechin told a Rosneft shareholders meeting.
Sechin, Russia’s most influential oil executive and a close ally of President Vladimir Putin, said an oil deficit of around 700-750 million tonnes a year was estimated by 2025.
His presentation said that to avoid a global shortage, 15 million barrels of oil per day (bpd) in new production globally would be needed.
OPEC+ countries - the cartel’s members, plus another 10 major producers including Russia - meet in Vienna this week to discuss a possible increase in production.
“For Rosneft ... such a situation creates a unique opportunity to increase global market share,” Sechin said.
He did not say by how much Rosneft was ready to increase its production if the group decided to ease global cuts from July 1.
Alexander Novak, Russia’s energy minister, has said Moscow would propose a gradual increase in oil output across the group by 1.5 million bpd from next month.
Current global curbs stand at 1.8 million bpd, of which Russia has pledged 300,000 bpd. Rosneft’s oil production was at 4.52 million bpd last year.
Rosneft plans to increase its oil and gas output to 330 million tonnes of oil equivalent by 2022, Sechin told the Rosneft shareholders meeting, with new oil and gas projects expected to yield 87 million tonnes of oil equivalent.
Without giving figures, Sechin also promised shareholders a “material” increase in dividends for 2018, saying the board of directors would meet soon to discuss parameters of a share buy-back announced by the company earlier.
Rosneft paid around 50 percent of its net profit in dividends on last year’s results.
Earlier this year, Qatar agreed to increase its stake in Rosneft to almost 19 percent after buying out Swiss trader Glencore almost entirely from their two-year-old joint venture.
Faisal Alsuwaidi, a Qatari representative on the Rosneft board of directors, said on Thursday that Qatar may consider increasing its stake further, though there were no immediate plans to do so. He said the company was “a good investment”.
Qatar’s sovereign investment fund QIA, together with Glencore, bought 19.5 percent of Rosneft for 10.2 billion euros ($11.8 billion) during the Russian firm’s partial privatization in 2016.
Last year the consortium agreed to sell a 14.16 percent stake in Rosneft to CEFC China Energy in a $9.1 billion deal, but this fell apart after CEFC Founder and Chairman Ye Jianming was put under investigation by Chinese authorities.
Ivan Glasenberg, head of Glencore and a Rosneft board member, when asked whether Qatar and Glencore had received a $400 million pre-payment from CEFC as part of the deal, said: “The deposit amount cannot mentioned, but it is close enough (to $400 million)”.
Asked about the fate of that deposit, Glasenberg said: “It is still being discussed, and we are handling it with CEFC.”
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Additional reporting by Vladimir Soldatkin and Maria Tsvetkova; Writing by Katya Golubkova; Editing by Tom Hogue, David Evans and Jan Harvey