Russian-British joint venture TNK-BP has vowed to ramp up capital expenditure after reporting a 54% rise in net income to $8.981 billion in 2011 on the back of strong production growth and high oil prices.
TNK-BP plans to lift capital spending to $5.5 billion in 2012 from $4.7 billion in the past year, and to further ramp up spending to around $6 billion in 2013 and 2014.
The venture will use the funds to develop new greenfield projects in Russia's northern Yamal region and move to stabilize falling production in West Siberia.
"I expect we might reach $6 billion in the future, when we start to ramp up new projects, but then that will start to come back down again," chief financial officer Jonathan Muir said, according to Dow Jones.
Around 80% of capital expenditure will be spent on the upstream segment with the rest on downstream, he added.
2011 revenues of the explorer were up to $60.2 billion from $44.646 billion in 2010, with earnings before interest, taxation, depreciation and amortisation rising almost 41% to $14.601 billion in 2011.
For the final quarter net income of $2.17 billion was up around 12% on the year-ago period but down 4% on the previous three months, something that TNK-BP put down to a lower foreign exchange gain.
TNK-BP said in a statement that the increase in revenues were driven by "a higher Urals price and production growth partly offset by changes in mix, i.e. redirection of crude volumes from export to the domestic and CIS market to take advantage of higher margins".
Total production including affiliates grew 2.8% to 1.987 million barrels of oil equivalent per day from last year’s 1.933 million.
Executive chairman Mikhail Fridman said the player had made significant headway on both Russian and international projects over the 12-month period.
2011 saw a number of high-profile acquisitions by the outfit, including oil-producing assets in Venezuela, offshore Vietnam and a pending farm-in to 21 blocks in Brazil’s Solimoes Basin.
TNK-BP said it raised $500 million in loans from a number of international banks in the fourth quarter of 2011, with its net debt up to $6.735 billion last year from $4.677 billion in 2010.