Russia's Lukoil To Cut Investments To $12.5B In 2015



Reuters

BUDENNOVSK, Russia June 24 (Reuters) - Vagit Alekperov, the head of Russia's No.2 oil producer Lukoil, said on Wednesday that the firm expected to invest $12.5 billion in 2015, down from around $15 billion last year, while its free cash flow was expected to reach more than $1 billion this year.

Oil companies worldwide have been cutting investments due to a slump in oil prices, which almost halved after peaking at $115 per barrel in June last year.

Alekperov did not give a reason for the cuts in spending.

Many Russian companies have reduced spending due to the international sanctions imposed on the country over its role in the Ukraine crisis. Lukoil is also under sanctions introduced by the United States.

One of Lukoil's key projects is the West Qurna-2 oilfield in Iraq, where production has reached 450,000 barrels per day.

He said Lukoil plans to redeem eurobonds worth $600 million next year.

Alekperov, Lukoil's largest shareholder with a stake of more than 20 percent, said that he would not be able to increase his stake to 30 percent due to unspecified restrictions.

(Reporting by Olesya Astakhova; writing by Vladimir Soldatkin; Editing by Elaine Hardcastle and Hugh Lawson)



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