Ty­men: Rus­sia’s Oil Cap­i­tal

Industry Leaders - - Content Features -

Tyu­men, one of Siberia’s old­est Rus­sian city, is sym­bolic of mod­ern Rus­sia’s in­flu­ence in oil and gas mar­ket. In the 16th cen­tury, Rus­sia ven­tured to­wards Cen­tral Asia ruled by the Tatars, Is­lamic peo­ple who still live in Rus­sia. A group of Cos­sacks took con­trol of Tyu­men from the Tatars in 1580. A few years later, Rus­sia built a fort in Tyu­men on the Tura River.

For the next three hun­dred years, Tyu­men com­peted with Tobolsk, a nearby city that was once the of­fi­cial cap­i­tal of Siberia, for pres­tige of the re­gion’s most in­flu­en­tial city. Af­ter a hard-fought bat­tle, Tyu­men won, when it snatched a deal for a Trans-siberian Rail­road from Tobolsk.

The now-oil rich city, also played an im­por­tant role in Rus­sian his­tory dur­ing the Rus­sian Civil War and the Sec­ond World War. More­over, many Rus­sian in­dus­tries moved away from the front to Siberian cities. By then, at the start of the Soviert era, it has al­ready be­come an in­dus­trial cap­i­tal, and an ideal spot for Rus­sian in­dus­tri­al­ist to re­lo­cate their fac­to­ries too. The dis­cov­ery of oil in Tyu­men pro­pelled set­tle­ment in the re­gion to fur­ther pros­per­ity.

To­day, the boom­ing oil cap­i­tal Tyu­man has been re­peat­edly named Rus­sia’s best city for qual­ity of liv­ing. In a study con­ducted by so­ci­ol­ogy ex­perts from the Rus­sian Gov­ern­ment’s Fi­nan­cial Univer­sity, it ranked ahead of Moscow and St Peters­burg. The sur­vey looked in 27 Rus­sian cities with pop­u­la­tions over 50,000, and in­cluded the stan­dards of med­i­cal care, ac­cess to ed­u­ca­tion, wealth, and life ex­pectancy.

It was the first ever Rus­sian set­tle­ment in Siberia and was founded to bol­ster the eco­nomic ex­pan­sion move­ment. In last four hun­dred years, it has pro­gressed from a small set­tle­ment lo­cated on im­por­tant trade routes, to a mil­i­tary set­tle­ment and now a large in­dus­trial city and one of Rus­sia’s im­por­tant busi­ness cen­ter.

As you drive past the royal palaces of the monar­chs of Rus­sia’s oil and gas in­dus­try, you’ll also no­tice that Lukoil, Gazprom, TNK-BP and all big in­ter­na­tional oil ser­vices com­pa­nies are all set here.

More­over, some of its most im­per­a­tive oil fields are sit­u­ated in the Tyu­men area, which ex­tends from the Kazakh bor­der to the Arc­tic. It is a shock­ingly smooth ride, not at all like in most other Rus­sian cities, there is rarely a pot­hole in sight.

Money has flowed into re­gional and fed­eral state vaults fol­low­ing the dis­cov­ery of oil and gas in the 1960s. Tyu­men’s future ex­cep­tion­ally re­lies upon the con­di­tion of the oil busi­ness. It has made Tyu­men, a city of 600,000 peo­ple, a stand­out amongst the most pros­per­ous cities in Rus­sia.

Tyu­men, es­tab­lished in 1586, was the main Rus­sian fort in Siberia, an im­por­tant stag­ing point for the tsarist em­pire’s east­bound ex­pan­sion. It may be one of the most im­por­tant cities in the world to­day, but one has it ad­mit, its com­plex ge­og­ra­phy could some­day be treach­er­ous.

This is why it has tones of sky­scrapers. Lots and lots of shiny build­ings owned by oil and gas com­pa­nies. Some of this build­ings con­tain long shelves with rock and soil sam­ples from TNK-BP’S oil fields and other ex­plo­rations ser­vices. Taken to­gether, they demon­strate the topo­graph­i­cal make-up of the re­gion, the dis­tance from the high­est point of the drill gap to the base, al­low­ing the ge­ol­o­gists to study on the DNA of an oil field.

Igor Dyakonov is the chief gen­eral of the Tyu­men Oil Sci­en­tific Cen­ter which houses the “core stor­age”. He ex­plains why oil com­pa­nies like TNK-BP need to spend more to look for oil in West Siberia. “The easy, ho­moge­nous reser­voirs have all been ex­plored and mostly de­vel­oped,” says Mr Dyakonov. “So we are mov­ing to fron­tier lo­ca­tions where the ge­ol­ogy be­comes more and more com­plex, and for that we need more fron­tier tech­nol­ogy.”

One of the or­ga­ni­za­tions want­ing to profit by that push is Baker Hughes, an Amer­i­can oil ser­vice firm. In their Tyu­men of­fice, a small group of ge­ol­o­gists pro­cesses oil field in­for­ma­tion which makes the drilling pro­ce­dure more ac­cu­rate. Af­ter the eco­nomic cri­sis, the com­pany has now set out on an ag­gres­sive growth strat­egy. Baker Hughes plans to of­fer drilling ser­vices and is plan­ning to set up its own man­u­fac­tur­ing fa­cil­i­ties in the re­gion. Tech­no­log­i­cal ad­vances, new dis­cov­er­ies and high prices will help Tyu­men keep its key po­si­tion in Rus­sia’s energy sec­tor.

As long as the oil keeps flow­ing and the prices are not down.

The Tyu­men re­gion pro­duces two-thirds of Rus­sia’s oil, and over 90 per­cent of its gas. The oil rig is sym­bolic of Tyu­men re­gion, how­ever, ev­ery year it’s get­ting harder and harder to ex­tract oil. While it is rel­a­tively a small prob­lem, for now, the re­gion is now try­ing to reestab­lish it­self as a tech­nol­ogy hub.

Decades of high crude oil prices has al­lowed ti­tans to dream big. The re­gion cap­i­tal has now turned into a jum­ble of sky­scrapers, and the con­struc­tion has led to con­sumer boom in spite of sky-high prices.

Although, the re­cent eco­nomic cri­sis hurt the con­struc­tion in­dus­try in Tyu­men, it has prompted the sec­tor to re­think their busi­ness prac­tices.

Tyu­men hopes that the ex­cess of oil and gas pays well into a future set with even big­ger chal­lenges. Con­struc­tion com­pa­nies have erected sev­eral tech­nol­ogy park to pro­vide

an op­por­tu­nity to the old town to in­no­vate. How­ever, a more com­pli­cated part is - how to get re­turns when the sce­nario is un­pre­dictable. For Tyu­men, the tech­nol­ogy sec­tor isn’t just sup­posed to be a cash cow for the present, but the key to the future.

Be­sides, their ob­jec­tive is to not only ad­vance in the oil and gas sec­tor, but to break out into other field such as agri­cul­ture, us­ing tech­nol­ogy.

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