ENERGY FOR PEOPLE - JSC Gazprom Neft

KEY PERFORMANCE INDICATORSOF THE COMPANY IN 2009 BY TYPEOF OPERATIONEnergy for lifeENERGY FOR PEOPLEPREMIUM BUSINESS SEGMENTSSHIP BUNKERINGGazprom Neft Marine Bunker LLC isa subsidiary of JSC Gazprom Neftthat supplies bunker fuel for sea- andriver-going vessels. The company wasestablished in October 2007. SinceFebruary 2008 Gazprom Neft MarineBunker has been a member of RussianAssociation of Marine and River BunkerSuppliers and by the results of 2009 thecompany is one of the leaders amongRussian bunker companies.Bunkering is a premium sales market forfuel oils and diesel fuel. The ambitiousobjectives of Gazprom Neft is by 2020to take up one third of the bunker marketwith its own port infrastructure, enterinternational markets and sell 77% fueloil and 5% of diesel fuel produced bythe Company at a premium comparedto traditional exports. In order to achieveits strategic objectives the Companyintends to ensure the production of notless than 2.7 mln tons of marine fuel thatwill comply with international standards;to create its own port infrastructure offive terminals and to have a bunker fleetof 28 bunker tankers.Gazprom Neft Marine Bunker ensuresguaranteed all-year-round suppliesof petroleum products (fuel oil, oils,and marine fuel) to ship owners andcharterers. The enterprise operatesin Saint Petersburg, Novorossiysk,Murmansk, and Russia’s Far Easternports.Marine fuel is mostly supplied by theOmsk Refinery while deliveries alsocome from the Moscow and YaroslavlRefineries.In 2009 Gazprom Neft Marine Bunkerwas operating in more than 22 ports,including all major sea ports. TheCompany established two subsidiaries:Gazprom Neft-Shipping LLC formanaging its own fleet (9 ships werebought in 2008) and Gazprom NeftTerminal SPb LLC for using theCompany’s own and leased terminals(currently the operator of the Kirovskyplant’s terminal in Saint Petersburg).AIRCRAFT FUELINGSale of jet fuel produced at JSCGazprom Neft’s refineries and operationof fuel service complexes at the airportswithin the Russian Federation are thekey operational priorities of CJSCGazprom Neft-Aero.As per the results of 2009, GazpromNeft-Aero became one of the leadersin retail sales of aircraft fuel (aircraftfueling) at airports in the RussianFederation.The business development objectiveof CJSC Gazprom Neft-Aero is furthergrowth of retail sales and expansionof a distribution network of fuel servicecomplexes both affiliated (own) andon a partnership basis, growth ofpresence in airports on the basis ofstorage agreements, and expansion ofgeography of aircraft fueling abroad.The Development Strategy of CJSCGazprom Neft-Aero until 2020 providesfor establishing a corporate networkof 15 modern fuel service complexesat Russian airports and for phasedregional development currently fromRussian airports to CIS airports inthe near term and to airports in otherregions of the world by 2020.In 2009 the amount of jet fuel sold byGazprom Neft-Aero reached 1 mln tonsand from this figure it can be confidentlystated that Gazprom Neft’s subsidiaryis a leader in the aircraft fuel market inRussia. By 2010 the Company intendsto occupy a significant share of themarket with the volume of retail salesestimated to amount to about 1.5 mlntons of aircraft fuel a year.Availability of own capacities at theairports will allow the company toensure good competitive positions inthe distribution markets and get a retailmargin on jet fuel sales.Currently CJSC Gazprom Neft-Aerooperates under direct contractswith airlines selling jet fuel withoutintermediaries. Among the principalcounterparties of the company areJSC Aeroflot — Russian Airlines, FGUPState Customs Committee of Russia,JSC Transaero, JSC Sibir Airlines, CJSCSky Express, CJSC Nordavia -RegionalAirlines, OJSC Donavia and others.The enterprise provides aircraft fuelingservices at the following airports:Sheremetyevo (Moscow), Domodedovo(Moscow), Pulkovo (Saint-Petersburg),and at the airports of Novosibirsk,Krasnoyarsk, Murmansk, Tomsk,Kemerovo, Bryansk and Chita.PRODUCTION AND SALEOF MOTOR FUELSGazprom Neft-Lubricants LLC(Gazprom Neft-SM) is a subsidiaryof Gazprom Neft established in2007. Currently, the enterprise holdsproduction assets in Western Siberia(Omsk), the European part of Russia(Yaroslavl), and in Western Europe(Bari, Italy). In 2009 Gazprom Neft-SMincreased, as compared to 2008, thevolume of standard goods’ segmentsales 2.7-fold, and of premiumgoods — 3.4-fold.In 2009 Gazprom Neft-SM activelydeveloped sales of lubricants of theCompany’s existing brands. The rangeof products contains some 90 titlesof oils sold under Gazprom Neft andSibiMotor brand names. During thepast two years the Company has builtan effective distribution structure whichenabled it to take 3% of the Russianconsumer oils market (SibiMotor brand),12% of the market of oils for commercialtransport, and 18% of industrial oilsmarket (Gazprom Neft brand). In2009 the Company also started activedevelopment of export sales: in Europeand CIS.In April 2009 Gazprom Neft-SM closedthe deal with Chevron Global Energyto purchase an oil and lubricantsproduction plant in Italy. The Italiancompany that joined Gazprom Neft has52