In terms of size Sidetrack and Workover Division will gain the lead this year among the Company’s drilling divisions. With as many as 1,250 employees this division comprises 16 drilling crews, 10 well conditioning and workover crews, 2 gyro and 15 telemetry crews. In the first half of 2003, the division will add 1 well conditioning and workover crew, 4 drilling and 3 tracking telemetering crews.

Having constructed 220 sidetracks by now, the division has provided for 2.2 million tons of additional oil. The operations performed by the division allowed the Company to commission 56 and 149 sidetracks respectively in 2001 and 2002. This year the Company is planning to construct 205 sidetracked holes including 20 multilateral wells.

The division mastered the technology of constructing wells with two horizontal sidetracks in 2001 when 6 such wells were constructed. Last year similar wells were put onstream. To increase the depth of sidetrack in payout oil source bed, Surgutneftegas mastered construction of wells with triple horizontal wellbores last year. There are no similar horizontal sidetracks and horizontal wellbores constructed in Russia and the CIS. Domestic oil producers and oil companies from the FSU have never performed such works by their own resources. The average depth at which the Company specialists constructed sidetracks in 2002 amounts to 3,000 m., with an average length of horizontal segments being 350 m. There are segments which have been drilled at an angle of 86-90 degrees. The previous year saw a 15% decrease in the working cost of a side hole construction. The current year is going to witness a further decrease in working costs resulting from the import substitution program being implemented by 17 Russian industrial enterprises.

This year the Company is going to drill a well with four side holes.

The Company’s specialists are expecting additional advantages stemming from the combination of side tracking and other technologies. For example, 12 oil fields are going to be the sites for the implementation of technological projects incorporating horizontal and side hole drilling; 26 oil fields are slated for the performance of deeply penetrating hydrofrac and for the construction of low-angle wells.

The Company’s credo is that a success in technology implementation can solely be achieved through being systematic and diversified.

The sidetracking project makes it possible to bring back into service oil fields which for a number of geological and technical reasons couldn’t be exploited by means of conventional procedures. This technology has ensured that sections of strata previously not available are now being developed; this in its turn makes it possible to produce oil being hard to recover and having been inaccessible through otherwise technologies.

Press service OJSC “Surgutneftegas”