Last checked at 4 Aug 2016 15:25
4 August 2016
Tatneft's Board of Directors Discussed the Company's Strategy to 2025
A regular meeting of Tatneft's (the "Company") Board of Directors chaired by R.N. Minnikhanov, the President of the Republic of Tatarstan, was held in Kazan (Republic of Tatarstan) on 3 August 2016.
The meeting reviewed Tatneft's budget performance for six months of 2016 and approved the budget for August of the current year.
The Board of Directors discussed the development strategy of the Tatneft Group of Companies for the period up to 2025. In crude oil production, which is the Company's main area of activities, for the first time the Company diverges from the concept of "stabilization" to the sustainable organic growth of crude oil production in the territory of the Republic of Tatarstan, the forecast is that by 2020 the annual production volume will reach 30 million tonnes. At the same time the plans provide for application of modern technologies, while automation of production processes and other measures will allow for reducing the level of specific operating costs by more than 10%.
The largest contribution to the Company's value growth is expected due to the development of oil refining activities. In the coming years, the main objectives set for the TANECO Complex are as follows: termination of fuel oil production and start of motor gasoline production in 2016-2017, the crude oil refining capacity is expected to grow to 14 million tonnes in 2018, while by 2025 the production of motor gasoline will increase to 3 million tonnes per year with diesel fuel yield amounting to 7 million tonnes per year. At the same time the refining depth will reach 97%, the yield of light oil products - 90%, which will be essentially higher than the target values prescribed by the Russian Federation Ministry of Energy in the federal energy sector strategies.
In terms of sales and marketing the target is to increase sales of motor fuels through high-margin channels: own filling stations and tank farms network. To support this approach the plan provides for updating the brand concept, increasing the quality and service standards, optimizing the regional coverage by the filling stations' network.
The development strategy to 2025 also envisages holding leading positions at the Russian tire market, assimilation of new market niches through effective implementation of marketing programs, quality improvement and expansion of the yielded product range, increasing the profitability of the Company's own generating capacities and machine-building business.
The presentation on Key Indicators of Tatneft Group Strategy to 2025 is available on the website of the Company:
http://www.tatneft.ru/for-shareholders/information-disclosure/presentations-to-investors/?lang=en
The Board also heard the information on further improving the system of the sectoral intra-corporate education and the progress on creation of the Higher Petroleum School on the basis of the Almetyevsk State Oil Institute. It was pointed out that under the new conditions taking into account the impact of the external and internal factors there had been developed a systematic approach to the corporate training in Tatneft. This year witnessed the creation of the Corporate University, which main task is to develop and implement educational programs aimed at the development of the general company-wide, administrative and general professional competences of the employees at all the levels. The main objective of the project "AGNI - Higher Petroleum School" is to transform the Institute into the All-Russian oil and gas center of education and science, providing for training of competitive professionals for the domestic oil industry, as well as creation and transfer of new knowledge and technologies in this area.
The Board approved resigning from the Management Board of the Company of Mr. Vladimir Lavuschenko, Deputy General Director of the Company for Economics and Finance, and Mr. Alexander Yukhimets, the Secretary of the Board of Directors of the Company due to their retirement.
The Board of Directors also considered a number of other issues of Company's activities.
This press-release contains inside information.
Forward-looking statements:
These materials contain statements about future events and expectations that are forward-looking in nature. Any statement in these materials that is not a statement of a historical fact is a forward-looking statement that involves known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements expressed or implied by such forward-looking statements to differ. PJSC TATNEFT assumes no obligations to update the forward-looking statements contained herein to reflect actual results, changes in assumptions or changes in factors affecting these statements