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Yukos to maintain oil production at last year's level

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MOSCOW, February 1 (RIA Novosti) - Russian oil major Yukos plans to produce 23.4 mln metric tons, or 462,000 bbl/d, of oil and gas condensate in 2006, the company said Wednesday.

That level would be slightly more than the combined production of the company's remaining major production subsidiaries, Tomskneft and Samaraneftegaz, in 2005.

At the same time, the company said that average daily output should be up by 12% by December 2006, at 66,500 metric tons, compared with 59,400 mt in December 2005.

Most of that oil would be sold on the domestic markets, Yukos said, although exports to China were expected to total around 1.8 million mt.

Throughput at the company's refineries in 2006 was targeted at 32.2 mln mt, roughly the same level as in 2005, Yukos said. The figure does not include Lithuania's Mazeikiu Nafta refinery, in which Yukos is to sell its majority stake.

Yukos said it was to invest $610 mln in oil production in 2006, while capital investment in oil refining and petrochemicals was planned at $280 mln.

Chief executive Steven Theede said tight controls on costs in 2005 had allowed for the investment program, in spite of the company's ongoing battle to clear its multi-billion dollar tax debts.

"We accrued a substantial amount on the balance sheet in 2005 that we can invest in our production facilities, our refineries and our teams this year," Theede said.

"During the same period we managed to take our overall tax burden down significantly with the total deficit owed to the Russian tax authorities and the bailiff service at the end of December 2005 being USD 6.3 billion."

Theede said Yukos continued to dispute a new claim for a further $3.5 billion that it received from the tax authorities at the end of December.

Yukos was aiming to reduce operating costs by a further 14% in 2006, the company said.

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