Russia 's largest oil producer OAO Rosneft (ROSN.RS) Monday said it is on track to increase full-year output by 4.5% as it ramps up production at the key Vankor field in East Siberia .

The company also said it expects tax breaks for oil produced at Vankor, with current output at 264,000 barrels a day, to stay in place for the rest of the year.

Tax uncertainty has weighed on Rosneft's shares in recent months. Rosneft's stock more than doubled last year, but lost close to a fifth of its value after a Jan. 11 peak, when Russia's finance ministry proposed revoking a zero export duty on oil produced at some East Siberian oil fields, including Vankor.

"We don't expect any changes in the export duty in the near to medium term," Rosneft Chief Financial Officer Peter O'Brien told Dow Jones Newswires.

O'Brien believes any possible changes to the zero export duty on East Siberian oil in 2011 and 2012 will be linked to broader tax reform.

The state-controlled company meanwhile reported that first-quarter net profit rose 19%, helped by crude output growth and higher oil prices, but weighed by increasing transportation costs and a stronger ruble.

London-listed Rosneft posted net profit under U.S. Generally Accepted Accounting Principles at $2.45 billion, up from $2.05 billion in the first quarter of 2009, beating an average forecast of $2.33 billion in a Dow Jones Newswires poll of 10 analysts.

Revenue for the quarter increased 79% to $14.76 billion from $8.26 billion a year earlier, boosted by a 8.4% rise in oil output to 2.288 million barrels a day--primarily due to the launch of the Vankor field in August.

"The results are pretty much in line with what was expected, and we see no surprises," said Svetlana Grizan, analyst at VTB Capital. "I don't think the market will react much on this."

At 1413 GMT, the company's GDRs were trading down 1.2% at $7.17 each in London , down from a one-year high of $9.30 reached Jan. 11.

The company, which accumulated massive debt after buying up assets from bankrupt rival OAO Yukos in 2007, said it reduced net debt by $2.1 billion in the first four months of the year to $16.4 billion.

Rosneft reiterated its growth output target for this year at 4.5%, mainly due to production at Vankor, which reached an average of 259,000 barrels a day in April.

Meanwhile, production at Yuganskneftegaz--its main production in West Siberia --continued to decline. The unit produced 1.29 million barrels a day in the quarter, down 1.2% from a year earlier.

Last year, Rosneft produced 109 million tons of crude oil, or 2.18 million barrels a day.

Rosneft's earnings before interest, tax, depreciation and amortization, or Ebitda, totaled $4.44 billion in the period, up from $2.32 billion last time.

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