OREANDA-NEWS. February 18, 2010. Bashneft plans to increase its oil output by approximately 8% this year, to 13.195MMt (264MBD). The company did not specify whether the anticipated increase is supposed to be 100% organic, reported the press-centre of OTKRITIE Financial Corporation.

View: Although this plan appears a bit ambitious, we believe the company has a chance to deliver on its 2010 growth target organically, taking into account the underinvestment in Bashneft's upstream assets over the past few years.

Hence, a potential increase in upstream capex by Sistema-controlled Bashneft this year could lead to a meaningful increment in production. Sistema took over Bashneft and all three refineries in Bashkortostan in 2009 with an eye to creating a larger and properly integrated oil and gas group.