Supply chain

Gazprom Neft develops cooperation with contractors with a focus on market transparency, market pricing as well as long-term and structured relationships. The Company is committed to utilising long-term contracting, various incentive tools for contractors and flexible pricing mechanisms.

Today we have built a system that allows us to work in a comprehensive manner with the contractor market: the accreditation of companies and a rating of the organizations that work with us. In this regard, multi-year framework contracts are a logical step towards building effective relationships with partners in major construction projects.
Marat Sayfutdinov Leader of the Major Construction Function in the Gazprom Neft Upstream Division

The Company’s counterparties for the supply of goods, work and services are selected in a unified manner based on a competitive procedure.

The approaches to engagement with counterparties make it possible to:

  • maximise the efficiency and effectiveness of procurements;
  • achieve an optimal level of competition among potential procedure participants;
  • ensure an objective, substantiated and impartial process for selecting winners of the procedures;
  • ensure reasonable transparency in the procedures conducted;
  • promote the development of the competitiveness and technological capabilities of contractors.

The basic criteria used when selecting counterparties for the supply of products, work and services include cost, quality, the timeframe for manufacturing and supply/performing work/rendering services, the reliability of the counterparty, its relevant technical and personal resources as regards the purchase of work/services and the necessary experience in performing such work/rendering such services for the corresponding area. One of the key criteria for selecting a counterparty for work/services is the counterparty’s compliance with the rules for industrial, environmental and occupational safety and civil defence (HSE, OS and CD) rules adopted by the Company. The Company concludes agreements with the selected counterparties on HSE, OS and CD containing requirements on compliance with the Company’s standards in industrial and environmental safety. The Company maintains a database and rating of counterparties that allows for identifying the most and least reliable suppliers and contractors.

‘Guaranteed Transparency’
The Company received the ‘Guaranteed Transparency’ award in 2016 based on the results of the National Procurement Transparency Rating. Ratings take into account the extent of information transparency of the competitive procedures, the intensity of competition, the degree of effectiveness of the competitive procedures and the screening of applications to take part in competitions as well as their cost-effectiveness.
Amount of payments made to suppliers (RUB bn) Source: Company data

In 2016, Gazprom Neft had a total of 1,827 counterparty organisations for the supply of goods. The share of the Company’s counterparties from the domestic market was more than 90%.

The Company is actively engaged in import substitution and supporting domestic manufacturers. Gazprom Neft has a Technological Partnership and Import Substitution Department that monitors the Russian goods market in an effort to find opportunities to phase out imported equipment and materials in favour of competitive Russian analogues.

Unique contribution
The interdepartmental working group in charge of reducing the Russian fuel and energy industry’s dependence on imports of equipment, components and spare parts as well as the services of foreign companies was held at the Gas Forum in St. Petersburg in October 2016. During the meeting, Russian Minister of Industry and Trade Denis Manturov expressed gratitude to Gazprom Neft for its unique contribution to the practical solution of import substitution objectives.