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Some Statements by President of Transneft Nikolay Tokarev for Media

Date of publication: 6 February 2020 Printable version

On 6 February 2020, President of Transneft Nikolay Tokarev took part in signing a contract for the development, manufacture and supply of induction traction motors between RUSSIAN ELECTRIC MOTORS (REM), a Transneft subsidiary, and Sinara Group’s Tyagovye Komponenty. During the event, he answered questions asked by journalists of Interfax IA.

Using Transneft Products in Locomotive Engineering

As per the signed long-term contract, the REM plant will develop and supply to Sinara Group 6,000 induction traction motors (ITM), having the capacity of 1,000 kW, to be used in the railway rolling stock.

Using enhanced performance ITMs in place of direct current commutator motors is a promising line of locomotive engineering development in Russia.

“We’ve discussed the areas, scale and volumes of our cooperation. During a short time, within literally one year, huge work has been done. The first motor, the flagship of the lineup, will be manufactured in May. Hopefully, our cooperation will be expanding. I am sure we’ll find other areas for our collaboration,” President of Transneft pointed out.

Export of Drag Reducing Agents

As for proprietary products, Transneft sees that CIS nations and other states are interested in buying the drag reducing agents it started producing last year at its plant in Tatarstan, Mr. Tokarev informs.

 “Today our manufacturing capacity allows us to fully switch to our domestically produced DRA. What’s more, we are entering CIS markets with this DRA, such as Kazakhstan, Belarus and the markets of other partners in the International Association, who are interested in this product,” he said.

“Because it is, to begin with, an absolute analogue of the American DRA, but as regards the working temperatures, it proved even better, retaining its effectiveness under lower temperatures. Secondly, economics is also important. Therefore, this manufacture arouses great interest,” President of Transneft pointed out.

“We also plan to manufacture other products using this manufacturing capacity; in the near future we will work with polymers. In general, we are happy to have harnessed this trend timely, and we are now developing it.”

Oil Pipelines in the East 

Furthermore, in his interview for Interfax IA Mr. Tokarev informed that Transneft planned to increase the amounts of oil transported via the Kuyumba — Tayshet oil trunk pipeline (OTP) by 43% in 2020 to 6.9 million tonnes.

In the words of the Company’s President, 4.86 million tonnes of oil were transported via the Kuyumba — Tayshet OTP in 2019, which is 1.8 times more year-on-year.

The amount of oil transported via the Zapolyarye — Purpe trunk pipeline will increase 2.1 times in 2020 to 16.3 million tonnes. In 2019, the Zapolyarye — Purpe pipeline transported 7.8 million tonnes, up 28% year-on-year, Mr. Tokarev informed.

“The situation has drastically improved with the loading of both oil pipelines: the Zapolyarye — Purpe and the Kuyumba — Tayshet. We did not expect both of the legs to reach the planned capacity immediately. Everything is proceeding in accordance with our expectations,” he underlined.

Tariff Regulation

The Federal Antimonopoly Service (FAS) is refusing to accept the possibility of dividends being included in Transneft tariffs, the Company’s President informed.

“They do not agree with such an approach, saying that dividends should be dividends, and the fact that our tariff is “inflation minus” is absolutely inexplicable and does not lend itself to any calculations. This is a very subjective approach — “inflation minus”, and that’s all. We have a government decision, though, that in view of our investment programme, our tariffs should be indexed as well. Yet for several years in a row we’ve had this ‘inflation minus,’” said Mr. Tokarev.

He also noted that so far, no decisions had been made in regard to setting a 10-year tariff for pumping the crude.

“This subject is being discussed and there are many opinions to this effect, so now I would not talk about any finalised models, since this would be premature, in my opinion,” said President of Transneft.

Sustaining the Profit

Transneft expects the level of profit under IFRS to be sustained in 2019, as compared to the previous year, said Mr. Tokarev, answering a question from Interfax.

“I do not think the profit will differ widely from 2018, because our freight turnover did not change much. The difference won’t be large,” he noted.

“The income won’t fall, that’s for sure,” President of Transneft underscored.

Mr. Tokarev reminded that Transneft had completed major transport system expansion projects and now the main task was to revamp, upgrade, automate and pursue import substitution policies.

“We’ve just completed all our ambitious and huge projects and now we are facing a different challenge: revamping and upgrading. We cannot allow the ageing of our pipes to run ahead of their upgrading; rather we should make sure the upgrading is more dynamic than the ageing of our pipes. Also new technologies, modern automation, import substitution. These are the key segments we’ll take care of in the years to come,” said President of Transneft.

Adapted from Interfax IA
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