Rosneft is the leader of Russia’s petroleum industry, and ranks among the world’s top publicly traded oil and gas companies. The Company is primarily engaged in exploration and production of hydrocarbons, production of petroleum products and petrochemicals, and marketing of outputs. Rosneft has been included in the Russian Government’s List of Strategic Enterprises and Organizations. The state holds 75.16% in the Company (through OJSC ROSNEFTEGAZ), while approximately 15% of shares are in free-float (see shareholder structure).
Rosneft is widely engaged in exploration and production across all key hydrocarbon regions of Russia: Western Siberia, Southern and Central Russia, Timan-Pechora, Eastern Siberia and the Far East. In addition, the Company participates in several exploration projects in Kazakhstan and Algeria. Rosneft’s seven major refineries have convenient locations throughout the country, from the Black Sea coast to the Far East, and the Company’s retail network covers 41 regions of the Russian Federation. Rosneft also owns 50% of Ruhr Oel GmbH which holds stakes in four refineries in Germany.
Rosneft is focused on expanding its resource base through intensive exploration and new acquisitions in order to secure sustainable production growth in the long term. Reserve replacement has averaged 150% in the last five years, not including acquisitions, which is among the highest indicators in the sector. Rosneft’s major exploration projects are located in Russia’s most promising oil & gas regions, such as Eastern Siberia, the shelf of Russia’s Black, Caspian and Azov seas, and the Russian Far East. As a result, the Company has access to 50.5 bln barrels of oil equivalent in prospective recoverable resources. In 2010 the Company acquired several blocks on Russia’s Arctic shelf, which is one of the most promising oil & gas regions in the world.
Rosneft has been successfully implementing its strategy of steady production growth, supported by constant monitoring and adoption of innovative technology. In 2010, the Company produced a total of 875 mln barrels of crude oil, thus posting a six fold growth in crude output over the last five years. Furthermore, the Company consistently maintains high operating efficiency, and has the lowest upstream production and operating expenses among its national and major international peers.
Rosneft is also one of the leading independent gas producers in Russia, with an annual output of natural and associated gas of about 12 bcm. The Company’s vast and unique reserve portfolio ensures steady long-term growth in gas output. Rosneft is currently implementing comprehensive measures aimed at achieving a target gas utilization rate of 95%, one of the Company’s high-priority objectives.
Rosneft also operates proprietary marine terminals in Tuapse, De-Kastri, Nakhodka and Arkhangelsk, which allows the Company to capture higher margins on crude oil and petroleum product exports. Rosneft is currently implementing comprehensive expansion and modernization programs at its terminals to ensure their capacity meets future export volumes.
Rosneft is aware of the importance of increasing direct sales of petroleum products to end customers. For that purpose, the Company is consistently extending its retail infrastructure, which now comprises 1,800 service stations – the country’s second largest marketing network.