Russian oil producer TNK-BP, which is being taken over by state-controlled OAO Rosneft (ROSN.RS), said Monday it will invest $7 billion in its Rospan natural gas project by 2040.

Rospan will increase output to 16 billion cubic meters of gas in 2020 from 3.5 bcm last year, the company said in a statement on its website.

Rosneft is acquiring TNK-BP , Russia 's third-largest oil producer, from BP PLC (BP.LN) and its partners in deals worth $55 billion that are expected to close in the first half of this year. BP will hold a 19.8% stake in Rosneft as part of its deal to sell out of TNK-BP.

Major Russian oil companies, including Rosneft and TNK-BP, are seeking to ramp up gas production, challenging state-controlled export monopoly OAO Gazprom's (GAZP.RS) dominance of the domestic market.

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