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Transneft Expert Board meets to discuss security matters

Date of publication: 28 June 2018 Printable version

Pictured (left to right): Vice President of Transneft Vladimir Rushailo, Transneft President Nikolay Tokarev, Vice President of Transneft Revel-Muroz and Vice President of Transneft Mikhail Margelov.

Expert Board of Transneft met on 28 June 2018 in President Hotel in Moscow to discuss security and import substitution matters along with promotion of the Company’s technologies and services to foreign markets to ensure the economic security of pipeline transport facilities.

President Nikolay Tokarev, Vice Presidents Mr Rushailo, Mr Revel-Muroz and Mr Margelov, federal legislation and executive authorities representatives, scientific and managing organisations took part in the work of Transneft’s Expert Board.

In his introductory address, Chairman of the Expert Board and Transneft President Nikolay Tokarev pointed out that Transneft celebrating its 25th anniversary this year, is one of the largest FES entities performing a strategically important mission: managing the unified system of trunk pipelines and oil and petroleum products transportation to home and foreign markets. Innovations used by the Company allow the delivery of projects on a nationwide scale, including the Eastern Siberia – Pacific Ocean pipeline system, Baltic Pipeline System, the Skovorodino – Mokhe pipeline offshoot to China and petroleum products trunk pipelines within the Sever and Yug projects. In the context of modern-day economic realities, further development of the Company will largely depend on addressing a range of challenges related to manufacturing of imported equipment analogues in Russia as well as other import substitution issues.  

As was noted by Transneft Vice President Vladimir Rushailo, import substitution in Russia addresses a number of interrelated tasks. First, it enhances national economic security by meeting the needs of Russian economy for goods, technologies and services, ensuring the continuity of business processes under the tough economic sanctions. Secondly, this policy supports the domestic manufacturer.

At the same time Mr Rushailo pointed out that practical implementation of import substitution and manufacturing localisation programmes is coupled with a number of legal problems.

“Analysing tax legislation shows that government programmes supporting the domestic manufacturer lack legal foundations and detailed mechanisms of providing a preferential tax regime or other bonuses for those Russian manufacturers who convert their production facilities within the import substitution or localisation programmes in order to launch fabrication of products no longer supplied to Russia in the wake of sanctions,” said Mr Rushailo.

Fiscal law imperfections make the effort of Russian manufacturers modernising their production facilities and putting out domestic equipment rather futile, since they often end up in the red and are not encouraged to develop manufacturing, he added.

Mr Revel-Muroz, Vice-President of Transneft, reported that Transneft plans to start manufacturing 26 new high-tech products within the import substitution programme. By now, full-scale manufacturing of 23 products has been set up, with more than 30 national entreprises involved in the corporate import substitution programme.

Among the most significant projects implemented within the Import Substitution Programme he mentioned commissioning of the Transneft Oil Pumps plant, mass production of oil and petroleum products quantity and quality metering systems at the facilities of the Transneftemash plant; construction of entreprise for producing a drag-reducing agent in Tatarstan as well as for manufacture of high voltage electric motors in Chelyabinsk.

Successful localisation of entreprises manufacturing equipment for of oil and petroleum products transportation will allow Transneft to reduce the share of equipment imported from abroad to 3% by 2020, added Mr Revel-Muroz.

Mikhail Margelov, Vice President of Transneft, mentioned in his report that promotion of products and services on foreign markets under stiffening competition and growing protectionism requires serious support, above all, from the Russian government. The Company receives substantial support in this field from the Ministry of Foreign Affairs, the Ministry of Energy and Ministry of Economic Development of the Russian Federation. Mr Margelov also expressed hope for effective interaction with the Ministry of Industry and Trade.

Mr. Margelov paid attention to the fact that Transneft has solid potential for exporting services and technology. “It is the unique technical solutions and many years of successful experience in various climatic conditions that enable us to offer goods, works and services of our subsidiaries to foreign partners,” he emphasized.

Taking an active part in the discussion that followed was the Chairman of the Security and Anti-Corruption State Duma Committee of Russian Federation’s Federal Assembly Vasily Piskarev, Deputy Chairman of the Defense and Security State Duma Committee of Russian Federation’s Federal Assembly Mukharbek Didigov, Deputy Chairman of Federation Council Committee for Economic Policy under Russian Federation’s Federal Assembly Mikhail Ponomarev, Official Secretary and Deputy Minister of Energy of the Russian Federation Anastasiya Bondarenko, Director of Machine Tool Building and Investment Machine Building Department at Russia’s Industry and Trade Ministry Mikhail Ivanov, Head of Staff at the State Duma Committee for Energy under Russian Federation’s Federal Assembly Dmitry Ivliev, Industry, Trade & Entrepreneurship Minister of Nizhny Novgorod Region Maksim Cherkasov, acting Director of the Institute of State and Law of the Russian Academy of Sciences Aleksandr Savenkov, Deputy Director of the Federal State Research and Development Institution (FGNIU) Institute of Legislation and Comparative Law under the Russian Government Andrei Gabov, Academic Secretary at the Centre for Security Studies under the Russian Academy of Sciences Igor Sinitsyn, Academic Advisor at the RAS Institute of Economics and Corresponding Member of RAS Ruslan Grinberg, Vice President and General Designer at the Russian Telecommunications Corporation State Company ROSTEC Andrei Badalov, Deputy Director of Industrial Development Fund Yuri Shamkov, Executive Director of Expert-Analytical Centre under the Union of Oil and Gas Producers of Russia Anatoly Zamriy, Director General of the Pipeline Transport Institute Yakov Fridlyand.

In the course of discussion, the Expert Board members pointed out that the import substitution efforts of fuel and energy companies are regulated to a certain extent, though the regulation needs to be improved, as regards the priority of products made in Russia over foreign analogues, as well as more incentives for manufacturers, including through the use of the special investment contract mechanism.

Expert Board members also expressed their opinion about the need to create a proper environment for the promotion of oil and petroleum products trunk pipeline transportation equipment and products in foreign markets, further improvement of mechanisms to provide tax breaks and other preferences for Russian enterprises involved in import substitution programmes, and to take additional measures for ensuring the security of business processes related to the manufacture of currently imported products or their analogues in Russia.

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