Meeting of PJSC TATNEFT’s Board of Directors
A regular meeting of the Board of Directors of PJSC TATNEFT named after V.D. Shashin chaired by R.N. Minnikhanov, President of the Republic of Tatarstan, was held in Kazan on August 25, 2020.
There were the results of executing Company’s budget for seven months of 2020 considered and the Company’s budget for September of the current year was approved at the meeting.
The event participants discussed the information on the results of the financial and economic activities of TATNEFT for the first half of 2020. The Company’s activities in the reporting period took place in the context of crude oil production restrictions under the OPEC+ Agreement, lower prices for crude oil and oil products caused by a significant reduction in demand due to restrictive resulting from the coronavirus pandemic.
TATNEFT produced 13.3 million tonnes of crude oil during the reporting period, while the output of petroleum products, including hydrocarbon gas, increased by 29% up to 6.2 million tonnes. The sales volume of petroleum products through the retail sales network increased by 22% to 2.4 million tonnes. 5 million tyre products were manufactured, which was 20% higher than the amount of outputduring the same period last year. The total amount of taxes accrued was RUB 171 billion.
The information about the measures taken by TATNEFT Group to reduce hydrocarbon production within the framework of quotas observance in compliance with the OPEC+ Agreement was presented to the Board of Directors. The total Company’s crude oil production is expected to amount to 25.9 million tonnes in 2020. The efficiency of the entire stock of wells was assessed and the least productive ones were shut down to minimize the negative impact of limiting crude oil production. Despite the high share of fixed costs in the structure of the crude oil production cost optimization measures made it possible to reduce specific operating costs by 6% relative to the baseline forecast for 2020.
The Board of Directors adopted a baseline scenario, which concept implies ensuring maximum marginality of crude oil produced, balanced launching of shut-in well stock, as well as expanding the program for geological and engineering operations in the second half of 2021 to form a forecast of the financial and economic activities of the Exploration and Production business block for 2021-2023.
The Board of Directors addressed the matter related to taking measures to combat the climate change and its consequences. Currently, there is a corporate program of measures to reduce greenhouse gas emissions being elaborated. The plans provide for updating the corporate strategy through the creation of business initiatives that imply the use of alternative energy sources, the introduction of “green” technologies; development of a circular production base, etc. to reduce the Company’s carbon footprint.
The Board of Directors presented awards to the Deputy General Director – Chief Geologist R.S. Khisamov. For a significant contribution to the development of the industrial potential of the Republic of Tatarstan and many years of productive work, Rais Khisamov was awarded the Duslyk Order. By the decision of the Board of Directors R.S. Khisamov was also awarded the honorary badge “For outstanding services to PJSC TATNEFT”.
The Board of Directors also considered a number of other issues.
