Last checked at 3 Apr 2009 14:17
3 April 2009
OJSC TANECO, a subsidiary of OAO Tatneft (LSE: ATAD), issued today the following press-release:
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OPEN JOINT-STOCK COMPANY "TANECO"
PRESS RELEASE
3rd April 2009
Taneco announces change in project execution strategy
Nizhnekamsk - OJSC TANECO today announces a change in the execution strategy for its refinery and petrochemical complex under development in Nizhnekamsk Tatarstan, Russian Federation. The change in strategy has been implemented in response to the current market environment and the change of outlook for the industry.
Contrary to recent reports, this change in strategy is not the result of financing difficulties and the project remains entirely viable with significant engineering, procurement and construction work currently underway.
The change in strategy is the result of a significant increase in forecast project costs if the costs provided by the EPC Contractor for the full realization of the project were to be accepted. These costs were provided as a part of the Open Book Lump sum conversion process and represent the contractor's proposed lump sum costs to complete the works. Accordingly, TANECO has elected to use other means of executing the completion works which will maintain the current project scope, forecast cost and scheduled completion date.
As a result of this change in execution strategy, OJSC Taneco has terminated the two stage EPC Contract for hydro-treating and aromatics units which was entered into with Tecnimont S.P.A and GS Engineering & Construction Corp in June 2008.
The termination of the Tecnimont/GS contract was for convenience and takes place before the implementation stage of the main works. The design work already completed will be transferred to Taneco for completion of the detailed design of the plant and Taneco and Tecnimont/GS are currently cooperating in the handover of the extensive documentation prepared to date.
Notes to editors:
1 The Nizhnekamsk Refinery and Petrochemical Complex is the key project in Tatarstan approved by the Russian Government. Construction work has been in progress since 2007 and is presently proceeding with installation of process equipment in the Crude and Vacuum units and above ground facilities in support off the offsites, utilities and infrastructure facilities to support the entire complex.
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For further information, please contact:
OAO Tatneft
Vladlen Voskoboinikov
Head of International Financial Reporting,
Member of the Management Board
Tel. +7 (495) 980-5256
E-mail: vladv@tatneft.net
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 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. OAO 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.