Message from the chairman of the management board

Alexander Dyukov Chairman of the Management Board,
CEO of Gazprom Neft PJSC

The year 2016 was a rather difficult one for the Russian oil and gas industry in terms of macroeconomic conditions. Nevertheless, Gazprom Neft succeeded in meeting all its challenges, once again demonstrating its ability to carry out highly complex projects regardless of the impact of external factors and confirming its status as the industry leader based on key performance indicators.

Gazprom Neft strictly adheres to the principles of corporate social responsibility and sustainable development by investing in the development of human resource potential and environmental protection and implementing programmes to support the regions where it operates.

The Company devotes considerable attention to improving the production safety management system. As part of this focus, Gazprom Neft is consistently progressing towards its ‘Goal – Zero: No Harm to People, Property or the Environment’. In 2016, we managed to significantly reduce the number of workplace incidents while ensuring a decrease in the injury level. The Company also focuses on environmental protection issues. Gazprom Neft spent more than RUB 14 billion on environmental safety projects in 2016. Among the most important projects were the construction of technological and transport infrastructure in an effort to increase the utilisation level of associated petroleum gas and the implementation of the ‘Clean Territory’ project to improve the reliability of pipelines. The active development of the Company’s Arctic projects is being accompanied by the implementation of an ambitious programme to preserve biodiversity in Russia’s Arctic zone. The Moscow and Omsk Oil Refineries are carrying out major projects to build treatment facilities that aim to drastically reduce the environmental impact of their production activities.

Gazprom Neft plays a significant role in the socioeconomic development of the territories where it operates by acting as an investor, taxpayer and employer. The Company creates tens of thousands of jobs by implementing major new projects and supporting the development of existing assets. Gazprom Neft is consistently among the country’s most attractive employers with top positions in the ratings of leading Russian and international recruiting agencies. As part of our human resource development programme, we continuously seek to improve the employee motivation and professional growth system and develop training projects that use the most progressive and effective methods. In 2016, the Company launched the Gazprom Neft Corporate University, which aims to form a highly flexible and effective educational environment that meets the requirements of today and tomorrow. Total investment in the training and development of our Company’s personnel exceeded RUB 700 million in 2016.

Tax payments by Gazprom Neft enterprises make up a substantial portion of regional and local budgets. While solving the most pressing and relevant problems of the regions where the Company operates as part of agreements on socioeconomic cooperation, Gazprom Neft also actively involves local residents in the process of positive transformations by initiating the development and implementation of social projects that aim to improve the quality of life. The ‘Native Towns’ social investment programme encompassed 35 regions in 2016 as the Company’s total social investments surpassed RUB 4 billion.

We view these funds as investments in the future – the future of our regions of operation and the future of the Company itself whose successful development is inextricably linked with the regions where Gazprom Neft extracts and refines oil and where it has filling stations and petroleum storage depots, refueling complexes and bunkering terminals. The future of the Company lies in its employees being motivated, driven and confident in their own safety and tomorrow. I am confident that the impact of sustainable development factors on the successful implementation of Gazprom Neft’s long-term strategy will invariably continue to grow.