UPDATE2: CEO: Lukoil seeks to raise hydrocarbon output by 1% annually

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LONDON, Mar 23 (PRIME) -- Russian oil major Lukoil targets production increase of at least 1% annually, CEO Vagit Alekperov said at an investor day on Friday.

“Our minimal strategic goal in the upstream sector – growth of hydrocarbon production by an average of 1% a year at the existing resource base at the oil price of U.S. $50 per barrel,” he said.

In 2017, Lukoil’s hydrocarbon output fell 4% to 658.3 million barrels. Gas output rose 15.8% to 28.9 billion cubic meters.

First Vice President Alexander Matytsyn said Lukoil plans to raise hydrocarbon output by 1–2% in 2018 mostly due to gas production without taking into account the West Qurna-2 project.

Azat Shamsuarov, senior vice president for oil and gas, said that the introduction of an added income tax could significantly affect Lukoil’s hydrocarbon production plans and a double growth is possible.

“A pilot project to introduce an added income tax is planned for launch in Russia in 2019. The new system takes into account the size of operating and capital expenditures while calculating the tax rate and thanks to it is capable of flexibly adjusting to fields with various production costs,” Shamsuarov said.

“We expect a double growth of production compared to a basic portfolio that we can ensure in the standard tax system,” he said.

Shamsuarov said Lukoil plans to launch the Rakushechnoye field in the Caspian Sea in 2023 and the Khvalynskoye field in 2030.

Alekperov also said that Lukoil is considering buying new producing assets, but has no plans to buy refining and sales enterprises.

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