Russia’s Ministry of Natural Resources and Environment has estimated the total value of Russia's oil reserves at RUB74.5 trillion ($1.2 trillion), almost doubling the valuation over one year, RBC business portal reported. Total value of hydrocarbons, gold, diamonds, copper, and iron ore is estimated at RUB93.4 trillion ($1.5 trillion).
Previously the ministry put the value of oil reserves at the end of 2017 at RUB39.6 trillion. The reserves of natural gas were valued at RUB11.3 trillion, and coking coal at RUB2 trillion.
RBC notes that in volume terms the discovered reserves grew by only 8.7% to 9.83mn tonnes of oil equivalent, making a 73% year-on-year surge in monetary value, which is not clearly justified in ministry's methodology. In US dollar terms oil reserves valuation increased by $385bn to $1.07 trillion.
The business portal also reminds that the ministry accounts for all reserves, not only those that are commercially extractible. Experts surveyed by RBC criticise the pricing methodology for its treatment of tax, calculating based on the sales price, and not the netback, and basing the valuation on heterogeneous data of oil producers themselves.
The ministry's valuation sees cost of lifting Russian oil at about RUB1,000 per barrel or $15.5 at current USD/RUB exchange rate, which is in line with previous government's estimates of $8-20 per barrel.
The value of gas reserves increased to RUB14 trillion, of gold to RUB614bn, of iron ore to RUB1.2 trillion, of diamonds to RUB546bn.