Kirill Seleznev Member of the Management Committee Head of the Gas - - PowerPoint PPT Presentation

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Sep 19, 2022 128 likes •352 views

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM Kirill Seleznev Member of the Management Committee Head of the Gas and Liquid Hydrocarbons Marketing and Processing Department, Gazprom; Director General, Gazprom

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PRESS CONFERENCE AS PART OF GAZPROM’S ANNUAL GENERAL SHAREHOLDERS MEETING

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

Kirill Seleznev

Member of the Management Committee – Head of the Gas and Liquid Hydrocarbons Marketing and Processing Department, Gazprom; Director General, Gazprom Mezhregiongaz

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2

Gazprom Group’s Gas Sales in 2012

Power industry - 27.6% Population - 20.7% Utility sector - 15.7% Agrochemistry - 7.5% Metallurgy - 5.3% Cement industry - 2,5% Miscellaneous - 20.7%

* – excluding intra-Group sales

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

In 2012 Gazprom Group delivered 249.7* billion m3 of gas to Russian consumers – 5.9% less than in 2011 (265.3 billion m3)

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Proceeds from Gas Sales by Gazprom Group

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

Gazprom Group’s proceeds from gas sales in Russia grew by 2.4% to RUB 740.3 billion (net of VAT and excise duty) versus 2011 356.1 399.5 474.3 494.9 614.7 723.0 740.3

2006 2007 2008 2009 2010 2011 2012 RUB billion

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1,125 1,301 1,653 1,885 2,345 2,725 2,964

2006 2007 2008 2009 2010 2011 2012

4

Gazprom Group’s Gas Sales Price

рублей/ 1000 м3

In 2012 average gas sales price in domestic market rose by RUB 238.8 to RUB 2,964.2 per 1,000 m3 (net of VAT and excise duty) versus 2011 с 2011 г. на 238,8 рублей и составила 2964,2 руб /1000 м3 (за вычетом НДС и акциза)

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

RUB/1,000 m3

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Gazprom Group’s Share in Russian Federation

In 2012 Gazprom Group’s share in domestic market made up 73.1%

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

80% 77% 77% 76% 73% 20% 23% 23% 24% 27%

2008 2009 2010 2011 2012

Other suppliers Gazprom Group

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0.5 12.2 1.2 0.3 0.7 0.3

Kamchatka Territory Primorye Territory Sakhalin Region 2012 2030

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Gas Demand in Far Eastern Federal District

By 2030 total gas consumption in Khabarovsk, Kamchatka and Primorye Territories, Sakhalin, Amur and Jewish Autonomous Regions as well as southern regions of Republic of Sakha (Yakutia) may amount to 22.5 billion m3 per year (+ 0.9) (+ 11.5) (+ 0.2)

billion m3

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

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82.7 103.2 125.7

2011 2012 2013

Proceeds 7

Gas Sales by Gazprom Mezhregiongaz Group

In 2012 Gazprom Mezhregiongaz Group sold 291.2 billion m3 of Gazprom and

ther suppliers’ gas, which is 5.1% less as compared to 2011 level

Including 31.9 billion m3 of gas sold at prices set in Russian Government’s Directive No. 333

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

RUB billion, net of VAT billion m3 * – 2013 target

(in case of 15% price increase by July 01, 2013)

* from gas sales to ultimate consumers at wholesale prices

27

31.9

33.8 Gas volumes

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8

Growing Debt to Gazprom Mezhregiongaz Group for Gas Supplied*

RUB billion

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

* – information as of December 31, 2012

In 2012 total debt of ultimate consumers to Gazprom Mezhregiongaz Group grew by

47%, total overdue debt – by 44% versus 2011

57.8 83.1 97.3 143.0

2011 2012

Overdue debt of ultimate consumers Total debt of ultimate consumers

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Gas Supplies to Socially Significant Consumer Groups

Total payments by socially significant consumer groups in 2012 –

91.7% (in 2011 – 93.8%)

Payments by utility companies in 2012 decreased to 88% (in

2011 – 95%)

In 2012 Gazprom Mezhregiongaz Group delivered 82.9 billion m3 of gas to socially significant consumer groups (85.5* billion m3 in 2011)

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

* – exclusive of

rganizations partially
perating as utility

companies

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Payment Level, % Change Compared to 2011, % Payment Level, % Change Compared to 2011, %

Bryansk Region

55.1 – 42.1

Vladimir Region

77.8 – 11.0

Penza Region

66.2 – 21.6

Arkhangelsk Region

92.8 – 7.9

Tver Region

77.1 – 18.2

Moscow Region

88.3 – 6.4

Novgorod Region

74.0 – 18.0

Volgograd Region

81.6 – 3.4

Astrakhan Region

71.6 – 11.9 10

Regions with significantly deteriorated payment level

Payments for Gas Made by Utility Companies in Russian Regions in 2012

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

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Payment Level, % Change Compared to 2011, % Payment Level, % Change Compared to 2011, %

Tomsk Region

103.5 + 10.3

Republic of Karachay- Cherkessia

95.1 + 4.1

Smolensk Region

95.5 + 7.9

Omsk Region

98.8 + 3.4

Republic of Ingushetia

74.1 + 6.8 11

Regions with significantly improved payment level

Payments for Gas Made by Utility Companies in Russian Regions in 2012

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

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REGIONS WITH WORST PAYMENT TRENDS REGIONS WITH BEST PAYMENT TRENDS

Republic of Chechnya

Payments by Population in 2012, %

In 2012 level of gas payments by population reached 95%, which is 3% higher than 2011 indicator

12

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

89.5 80.4 74.1 71.3 42.1 98.8 94.1 93.4 93.3 65.5

Republic of Kabardino- Balkaria Republic of Karachay- Cherkessia Republic of North Ossetia – Alania Stavropol Territory Tver Region Moscow Orel Region Moscow Region Kursk Region

98.9 97.3 96.2 99.8 98.1

2011 2012

+ 9.3 + 23.4 + 13.7 + 19.3 + 22.0 – 2.7 – 5.9 – 2.9 – 5.0 – 5.5

96.1 94.4 91.2 94.3 92.2

2011 2012 2011 2012 2011 2012 2011 2012

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Reasons for Debt Accumulation

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

Existence of managing companies acting as intermediaries in chain of

population’s payments for heat

Existence of unfair boiler house operators taking property on lease, as a

rule, from municipal authorities

Economically unjustified heat rates
Complicated procedure of gas supply limitation to persistent non-payers
Low efficiency of gas debt recovery by court bailiffs

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Key Activities to Improve Gas Payments Collection in 2012

1. Claims (warnings) filed against debtors in amount of RUB 74.8 billion. 2. Legal actions initiated against debtors in amount of RUB 43 billion. 3. Court rulings and writs made in respect of RUB 36.6 billion. 4. Debts recovered as part of enforcement procedures in amount of RUB 28.2 billion. 5. Gas debtors disconnected from supply – 160 thousand. 6. 13.2 thousand cases of illegal gas offtakes in amount exceeding RUB 408 million detected and prevented. 7. 5.7 thousand requests directed to law enforcement bodies to impose sanctions against offenders, over 3.9 thousand administrative and criminal proceedings filed, RUB 85 million indemnified. 8. Debts worth RUB 4.7 billion transferred from insolvent legal entities to solvent ones. Transferred debt worth RUB 3.7 billion repaid. 9. Draft amendments aimed at simplifying limitation of gas supply to consumers into Russian Government’s Resolution No. 354 of May 6, 2011 and No. 549 of July 21, 2008 were submitted to Russian Energy Ministry.

10. Draft federal law on Introduction of Amendments into Certain Legal Acts of Russian Federation to

Secure Uninterrupted Heat Supplies to Social Consumers was developed.

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

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RUB billion

15

Total investments amounted to RUB 190 billion,

including RUB 180 billion between 2005 and 2012

Investments in Gazprom’s Russian Regions Gasification Programs

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

0.9 2.6 3.5 2.9 9.2 17.9 20.8 24.2 19.3 25.6 29.1 33.8

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

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Regional Authorities’ Obligations in Respect of Consumer Preparation for Gas Supplies Russian regions falling behind schedule in 2012

Novgorod Region Republic of Bashkortostan Kamchatka Territory Republic of Kalmykia Republic of Karachay-Cherkessia Republic of Mari El Kurgan Region Ryazan Region Orenburg Region Saratov Region Penza Region Republic of Udmurtia Primorye Territory Chelyabinsk Region

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

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Bryansk Region from 2012* Orel Region from 2012 Vladimir Region from 2012 Republic of Adygea from 2010 Volgograd Region from 2008 Republic of Dagestan from 2009 Vologda Region from 2012 Rostov Region from 2012 Kaluga Region from 2012 Smolensk Region from 2012 Krasnodar Territory from 2007 Stavropol Territory from 2012 Leningrad Region from 2006 Ulyanovsk Region from 2012 17

Regional Authorities’ Obligations in Respect of Consumer Preparation for Gas Supplies Russian regions failing to meet their obligations according to schedule in 2012

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

* – first year of failure to meet obligations

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2013 Russian Regions Gasification Program provides for investments in amount of RUB 33.4 billion,

including RUB 27.8 billion for construction of gas distribution networks, gas branches and GDSs in 68 Russian constituents

2013 Russian Regions Gasification Plans

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

RUB 4.152 billion for design and survey activities
RUB 1 billion for developing CNG filling stations network
RUB 300 million for developing and adjusting general gas supply

and gasification schemes

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Future redistribution of investments under adjusted Program based on half year results directly depends on how regional authorities meet their obligations in respect of consumer preparation for gas supply and on situation with regional gas debts 19

2013 Russian Regions Gasification Program

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

Regions with highest gas debts / failed obligations under 2005–2012 gasification programs Republic of Dagestan Stavropol Territory Moscow Region Volgograd Region Tver Region Republic of Karachay-Cherkessia Republic of North Ossetia – Alania Arkhangelsk Region Republic of Kabardino-Balkaria Komi Republic Republic of Ingushetia Kaliningrad Region Krasnodar Territory

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53.3 64.4 65.3

Total gasification in Russia

70.9 54.0 70.1 53.1

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Provided that regional authorities meet their obligations, average gasification level in Russia may amount to 65.3% Projected Level of Gasification Based on Russian Regions Gasification Program Results in 2013

GAS SUPPLY TO DOMESTIC MARKET. EXECUTING RUSSIAN REGIONS GASIFICATION PROGRAM

% 2005 2013

60.0 34.8

Gasification of towns and cities Gasification of rural area

2014

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PRESS CONFERENCE AS PART OF GAZPROM’S ANNUAL GENERAL SHAREHOLDERS MEETING