Created: 1/25/1971

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Future Soviet Crude Oil Production . Shashln, Soviet Kinister of the Petroleum Extraction Industry, recently predicted that the USSR will produce more0 Million tona of crude oil5 and that in the future it will overtake the US and becoaw the world's leading oil producer. This statement, containedecent issue of the weekly newspaper Litcraturnaya Gazeta, and cited in The Mew York Times ofanuary, is subject to several possible interpretations. Prediction of an output of0 million tonsbout the level of current US production, wouldeturnoal cited by Shashln la This goal, however, was subsequently lowered toillion tons, because production froa theolga region is leveling off and tho climatic and geological conditions encountered ln developing new producing regions ln Western Siberia and in Central Asia are extremely difficult.

-2. Return to the earlier goal could indicate greater optimism about solving the problems of production in the new oil regions, or it couldedefinition of crude oil output. To reach an output of0 million tons5 would require the annual Increase ln production to* million tons. Although such Increases ore not impossible, they are larger than have been achieved ln amy past period, and they can only be attained if the USSR can develop, or acquire from the Free World, suitable technology and equipment to cope with development ofand oil fields in permafrost and in desert regions. rerequisite wouldonsiderable increase in capital inventment for oilfield and

transportation equipment, Koraething that Shashln previously has indicated will not be forthcoming.

3> The possibilityedefinition of crude oil output is suggested by several apparently conflictinghat have appeared in recent months. Onhashin announced that production of "crude oil"1 wouldillion tons, or only5 million tons more than the amount reported as having been produced Onowever, in Pravda he1 production goalillion tons of "crude oil and condensate". (Condensates are hydrocarbon liquids which arc gaseous or in solution with crude oil in the reservoir. In the USSR they previously have been flared, or if recovered, reported as natural gas production.} The same article indicated that production1 would exceed that0 byillion tona. Theecember Issue of Pravda reported that production of liquefied gas in the USSR is to increaseillion tons If liquefied gas ia assumed to be equivalent to condensate production, tho actual increase in crude oil production1 might be aroundillionore reasonable figure in the light of past experience. If tbe sane reasoning applios throughouteriod, actual crude oil production5 would probably fall in the range ofillion toni, although an outputillion tons of "crude oil and condensate" might be claimed.

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