BP strikes it rich in Russia

LORD Browne, chief executive of BP, today made a dramatic sevenfold upgrade to the size of the company's Russian oil reserves.

In an eagerly-awaited presentation to City analysts, he revealed that BP's Russian venture could contain as much as 30bn barrels of oil compared with just 4.1bn currently recorded under US accounting standards.

The upgrade stems from a detailed analysis of the oil assets owned by BP's 50% Russian venture, TNK-BP.

It says reserves could more than double to 9.4bn barrels if the full life of the fields were taken into account. Another 21bn reserves have been discovered by the joint venture since it acquired its stake.

Browne also said the venture has boosted average production by 10% to 1.2m barrels a day over the first half of this year. It is expected to rise by between 12% and 14% over the year as a whole and a further 7% in 2004. Thereafter it will rise by an average of 5% a year.

Capital spending is likely to be stepped up to $1bn (£600m) a year from $850m in the short term. BP bought the Russian stake in August for $8.8bn.