Production Planning and Logistics

Main Results in 2018

• the Company met its oil and petroleum product shipment targets;
• refineries production program developed and petroleum product sales destinations approved with a view to maximize refining margins;
• agreements signed with Russian Railways to provide discounted railway transportation for supplies from the Komsomolsk Refinery, the Saratov Refinery, Samara Group Refineries, and ROSPAN;
• a new transshipment direction created for the whole range of the Company’s petroleum products and LPG in the Taman port;
• a pilot project implemented to synchronize daily production and shipment targets with a subsequent daily factor analysis of the variance at the branch of RN-Trans in Angarsk and at the Angarsk Petrochemical Company, which reduces the non-production idle hours of empty rail cars.

LLC RN-Morskoy Terminal Tuapse, Petroleum Products Transshipment Terminal

Supply sources:

• Tuapse Refinery;
• Saratov Refinery;
• Samara Group Refineries.

The terminal is implementing a production asset renovation program aimed at bringing them in line with new requirements of industrial, environmental, and fire safety, as well as a program to develop production facilities to cover the prospective cargo turnover of the Tuapse Refinery.

The following facilities have been commissioned:

• Refitting of vertical steel tanks No. 15, 16 for 10 thousand cub. m (according to GP) for motor gasoline and jet fuel (installation of floating roofs);
• Tank farm. Modernization (retrofit) of the TRL/2 system (stage II).

The following projects have been continued:

• designing the facilities for Modernization of the Gas-Catching System and Gas-Equalizing  - the 2nd phase;
• Equipping of racks No. 1, 2, and 3 with scales;
• Renovation (extension) of the South-Eastern (Pervomaysky) Wave-Breaking Jetty, Stationary Fall Protection Systems;
• Ongoing amendments to design documentation of the Left Bank Treatment facilities (III, IV Start-Up Facilities).

Key Strategic Priorities:

• optimization of production programs at refineries and petroleum product sales to the most profitable destinations;
• reduction of logistics costs involved with product transportation by diversifying modes of transport and optimizing costs of the Company’s own logistics assets;
• meeting of commitments for the rail shipment of petroleum products from the Saratov Refinery, the Samara Group Refineries, the Komsomolsk Refinery, and ROSPAN in order to extend the discounting conditions provided to the Company by Russian Railways in 2019;
• pilot operation of the petroleum products real-time accounting system at the Company’s offshore terminals, which will enable to carry out automatic accounting validity control procedures and procedures for monitoring the imbalances arising during acceptance, shipment, storage, inventory, and intra-warehouse movements of petroleum products;
• elaboration of initiatives to increase processing margins, synchronization of daily production and shipment targets, followed by a variation analysis;
• development and organization of new efficient logistics schemes;
• structuring and development of the Company’s shipping activities in view of the preparation for a substantial increase in the number of vessels navigated.

LLC RN-MORSKOY TERMINAL TUAPSE, PETROLEUM PRODUCTS TRANSSHIPMENT TERMINAL

Supply sources:

• Komsomolsk Refinery;
• Angarsk Petrochemical Company;
• Achinsk Refinery;
• Third Party Suppliers.

The terminal is implementing a production asset renovation program aimed at bringing the assets in line with new requirements of industrial, environmental, and fire safety. In 2018, the Company was continuing a program to renovate the tank farm, oil pier, process pipelines, and utility networks at the terminal in order to bring them up to the requirements of existing legislation.

LLC RN-Arkhangelsknefteproduct, Petroleum Products Transshipment Terminal

Supply sources:

• Samara Group Refineries;
• Angarsk Petrochemical Company;
• Third Party Suppliers.

In addition, the terminal is used to deliver fuel to the Far North and to supply wholesale customers in the Arkhangelsk Region. In 2018, the design of the Arkhangelsk Terminal renovation project was completed.