Anglo-Suisse Inc. is laying off several dozen employees involved in White Nights Joint Enterprise, its joint oil-producing venture in Russia, as Russian employees and equipment take over much of the work previously done by their U.S. counterparts, company sources said Tuesday.

Other partners in White Nights are Phibro Energy Inc. and the Russian oil producer Varyeganneftegas.Meanwhile, the sources said Anglo-Suisse is starting work toward a new joint oil production venture in Russia with Varyeganneftegas, to be known as Northern Lights.

Many of the employees being laid off from the White Nights project have been based in Radudjni, Western Siberia, where White Nights operates, and in Houston, where Anglo-Suisse is based, the company sources said.

The move is part of a broad-based effort to reduce costs, the sources said. They noted that shifts in dollar-ruble exchange rates in the past year have made it more costly to have foreign workers and equipment on site. Last week, Phibro said Parker Drilling Co., which had operated several drilling rigs in Siberia for White Nights, was told its services would no longer be required on the project.

That move is resulting in a separate reduction in the foreign work force at Radudjni, according to Phibro.

Sources associated with the project said Tuesday the move means an end to the horizontal drilling being carried out by Parker, although vertical wells will continue to be drilled with Russian equipment.

Horizontal drilling involves advanced technology that allows wells to be started vertically and reoriented horizontally at desired depths. By tapping into certain oil reserves from the side, production levels can be greater than with traditional vertical wells.

"I think Western equipment will be back in there at some time in the future," said one Anglo-Suisse source. He noted that an eventual move toward hard-currency dealings by Russian oil-field equipment companies could over time make costs more similar to those in the West.

The source also said it is possible that the laid-off employees may be asked to rejoin Anglo-Suisse in connection with its second Russian joint venture, Golden Mammoth.

"I think that certainly to the extent that they meet with our plans for Golden Mammoth, that would be the sensible thing to do," he said.

Golden Mammoth, which also involves Phibro and Varyeganneftegas, has the potential to produce 600,000 barrels of oil a day from fields not far from where White Nights operates, Anglo-Suisse said recently.

Golden Mammoth is being organized with investments of $300 million from the three partners. Sources confirmed Tuesday that Norsk Hydro is among companies talking to Anglo-Suisse about acquiring a fourth stake in that venture.