Oil and Gas Industry of Russia

Fuel resources provide energy not only the entire industry of any country in the world, but virtually all spheres of human life. The most important part of Russia's fuel and energy complex is the oil and gas sector.

The oil and gas industry is the generalized name of a complex of industrial enterprises for the extraction, transportation, processing and distribution of final products of oil and gas refining. This is one of the most powerful branches of the Russian Federation, which largely forms the budget and the country's balance of payments, ensuring foreign exchange earnings and maintaining the exchange rate of the national currency.

History of development

The beginning of the formation of the oil industry in the industrial sector is considered to be the year 1859, when the first time in the US for the extraction of oil was mechanical drilling of wells. Now practically all oil is extracted by means of wells only with a difference in efficiency of production. In Russia, the extraction of oil from drilled wells began in 1864 in the Kuban. At that time, the debit of production was 190 tons per day. In order to increase profits, much attention was paid to the mechanization of extraction, and already at the beginning of the 20th century Russia took the leading place in oil production.

The first major areas to extract oil in Soviet Russia were the North Caucasus (Maikop, Grozny) and Baku (Azerbaijan). These dwindling oldest fields did not meet the needs of the developing industry, and significant efforts were made to discover new deposits. As a result, several fields were commissioned in Central Asia, Bashkiria, Perm and Kuibyshev regions, the so-called Volga-Ural base was established.

The volume of oil produced reached 31 million tons. In the 1960s, the amount of black gold produced increased to 148 million tonnes, of which 71% was in the Volga-Ural region. In the 1970s, deposits of the West Siberian Basin were discovered and commissioned. With oil exploration, a large number of gas deposits were discovered.

The significance of the oil and gas industry for the Russian economy

The oil and gas industry has a significant impact on the Russian economy. At present, this is the basis for the formation of the budget and the operation of many other branches of the economy. The value of the national currency is largely dependent on world oil prices. The carbon energy resources produced in Russia allow to fully meet domestic demand in fuel, ensure the country's energy security, and also make a significant contribution to the world energy resource economy.

The Russian Federation has a huge hydrocarbon potential. The oil and gas industry of Russia is among the leading in the world, fully provides domestic current and future needs for oil, natural gas, and their processing products. A significant amount of hydrocarbon resources and their products are exported, providing replenishment of the foreign exchange stock. Russia ranks second in the world in terms of liquid hydrocarbon reserves with a share of about 10%. Oil reserves have been explored and mastered in the bowels of 35 RF subjects.

Oil and gas industry: structure

There are several structural main processes, of which the oil and gas industry consists: the oil and gas production, transportation and processing industries.

• The extraction of hydrocarbons is a complex process, including exploration of deposits, drilling of wells, direct extraction and primary purification from water, sulfur and other impurities. Production and pumping of oil and gas to the site of commercial accounting are enterprises or structural units, whose infrastructure includes booster and cluster pumping stations, water discharge facilities and oil pipelines.
• Transportation of oil and gas from production sites to metering stations, processing plants and the final consumer is carried out with the help of pipeline, water, road and rail transport. Pipelines (field and main) are the most economical way of transporting hydrocarbons, despite the very expensive facilities and maintenance. Pipeline transportation of oil and gas moves over long distances, including various continents. Transportation by waterways using tankers and barges with displacement up to 320 thousand tons is carried out in long-distance and international messages. Rail and truck transport can also be used to transport crude oil over long distances, but is most economically efficient on relatively short routes.
• Processing of crude hydrocarbon energy carriers is carried out in order to obtain various types of petroleum products. First of all, these are different types of fuel and raw materials for subsequent chemical processing. The process is carried out at oil refineries of the refinery. The final products of processing, depending on the chemical composition, are divided into different grades. The final stage of production is the mixing of the various components obtained in order to obtain the required composition of the corresponding petroleum product.

Deposits of the Russian Federation

The oil and gas industry of Russia includes 2,352 oil fields being developed. The largest oil and gas region in Russia is Western Siberia, accounting for 60% of all extracted black gold. A significant part of oil and gas is extracted in the Khanty-Mansi and Yamal-Nenets Autonomous Districts. The volume of production in other regions of the Russian Federation:

• The Volga-Ural base is 22%.
• Eastern Siberia - 12%.
• Northern deposits - 5%.
• Caucasus - 1%.

The share of Western Siberia in the production of natural gas reaches almost 90%. The largest deposits (about 10 trillion cubic meters) are in the Urengoy field in the Yamal-Nenets Autonomous District. The volume of gas production in other regions of the Russian Federation:

• The Far East - 4,3%.
• Volga-Ural deposits - 3.5%.
• Yakutia and Eastern Siberia - 2.8%.
• Caucasus - 2,1%.

Refining of oil and gas

The task of processing is to turn crude oil and gas into marketable products. Refinery products include fuel oil, gasoline for vehicles, jet fuel, diesel fuel. The refining process includes distillation, vacuum distillation, catalytic reforming, cracking, alkylation, isomerization and hydrotreating.

Natural gas processing includes compression, amine-purification, glycol dehydration. The process of fractionation implies the separation of the flow of liquefied natural gas into components: ethane, propane, butane, isobutane and gas gasoline.

The largest companies in Russia

Initially, all major oil and gas fields were developed exclusively by the state. To date, these objects are available for use by private companies. In total, the oil and gas industry of Russia has more than 15 major mining companies, including the well-known Gazprom, Rosneft, Lukoil, and Surgutneftegaz.

The largest Russian companies in the sphere of gas production and processing are Gazprom and Novatek. In the oil industry, Rosneft's leading positions in the market, as well as leading companies, are Lukoil, Gazprom Neft and Surgutneftegaz.

Oil and gas industry: review of the situation in the world

By the number of proven oil reserves, the Russian Federation ranks sixth in the world. Proven reserves are those that can be extracted using modern technology. The leading position in the world is Venezuela. The amount of oil reserves in this country is 298 billion barrels. The proven reserves of natural gas in Russia are 47.6 trillion cubic meters. This is the first indicator in the world and 32% of the world's total. The second gas supplier in the world is the Middle East.

The oil and gas industry in the world allows solving important economic, political and social tasks. Given the favorable situation on world energy markets, many oil and gas suppliers, through export earnings, are making significant investments in the national economy, demonstrating exceptional growth dynamics. The most striking examples are the countries of South-West Asia, as well as Norway, which, with a low industrial development, thanks to hydrocarbon reserves, has become one of the most prosperous countries in Europe.

Development prospects

The oil and gas industry of the Russian Federation largely depends on the behavior on the market of its main competitors in extraction: Saudi Arabia and the United States. In itself, the total amount of hydrocarbons produced does not determine world prices. The dominant indicator is the percentage of production in a single oil state. The cost of production of 1 barrel in different countries-leaders in production varies significantly: the lowest in the Middle East, the highest in the United States. When oil production is unbalanced, prices can change both in one direction and in the other direction.