RussNeft finds unjustified charges of having exceeded the limit of oil production by a number of its subsidiaries.

Today General Prosecutor’s Office of Russian Federation reported of having filed charges against  the heads of OAO Aganneftegazgeologia, ZAO Nafta-Ulyanovsk and OAO Ulyanovskneft – in connection with exceeding the limits of oil production and receiving revenue from unlawful act.

RussNeft believes this was caused by an incorrect method of calculating of oil production excess as compared to a projected forecast on subsidiaries’ fields and that of calculating earned revenue. For instance, yearly an annual production at a group of fields of the companies specified above has been lower than a projected one; moreover, the cumulative recovery projected at each field since the beginning of the development has not been reached for today, the report says. The alleged revenue from the excess of production, according to RussNeft, has mistakenly been calculated as the excess of actual production as compared to the projected one multiplied by today’s world oil price, taxes excluded, and operating costs. The results of the verification say, with regard to that period’s selling price, the actual revenue obtained arbitrarily increased 28-fold, the report runs.

General Prosecutor’s Office data says Aganneftegazgeologia’s revenue from sales of oil produced beyond the limits has been almost 5 bln rubles, that of Nafta-Ulyanovsk – almost 700 mln rubles, Ulyanovskneft – around 2 bln rubles.

RussNeft C=comprises 30 producing entities, 3 oil refineries and 2 transporting entities and a modern distribution network of 300 gasoline filling complexes. Company’s subsidiaries are in 17 regions of Russia and CIS. Total recoverable reserves of RussNeft exceed 630 mln tons. Annual production for 2005 was 17 mln tons of oil.