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5

Gazprom To Surpass BP, Exxon By Oil Production

Gazprom is planning a major move into oil in order to compete with such world oil players

Gazprom is planning a major move into oil in order to compete with such world oil players as BP, Exxon and Shell by getting half its income from oil.

Gazprom?s chief executive Alexei Miller said at the shareholders? meeting on Friday, "We are studying the possibility of new acquisitions in this sector in Russia and abroad. With this in mind, we plan to cut our dependence on gas exports.?

Gazprom is the world's biggest natural gas producer, but many of its gas fields also have oil and in the first five months of this year it produced an average of 260,000 barrels per day of oil and gas condensate, almost all of which it sold within Russia.

Miller said that oil output would soon rise because new fields would come on stream, such as the Kara Sea Prirazlomnoye or the Siberian Tazovskoye deposits.

Gazprom will also recieve $7 billion from the sale of its treasury stock back to the state by the end of 2005 and its executives have said the firm might use the money to buy oil assets in Russia and abroad.