A meeting of the Transneft, JSC management and representatives of the leading Russian and foreign media outlets was held on January 13, 2015, the Russian media professional day. At the meeting, Transneft, JSC was represented by First Vice President Maksim Grishanin, Vice President Aleksey Sapsay, Deputy Vice President Igor Katsal, Deputy Vice President Vladimir Nazarov, and Deputy Vice President Sergey Khodyrev. At the meeting, Maksim Grishanin congratulated the media representatives on their professional day and answered a number of questions.

Oil Exports via the Pipeline System

Oil companies submitted applications to Transneft, JSC for receiving oil into the company's pipeline system in the amount of 478 million tons in 2015; in 2014, this parameter reached 479 million tons, said Maksim Grishanin. He explained that 209.4 million tons are planned to be pumped for exports (213.7 million tons in 2014). 266 million tons of oil are planned to be supplied to Russian oil refineries in 2105.

Igor Katsal, Deputy Vice President of Transneft, JSC, added that, according to the planned targets, in January of this year oil exports via the company's system will increase by 1.5 million tons as compared to December 2014.

Dividend Policy

The Transneft Board of Directors plans to consider in the first half of 2015 changes in the company's dividend policy, said Maksim Grishanin.

He also said that Transneft does not plan to repurchase bonds to reduce debt, as the debt indicator is currently at an acceptable level. He said that the company is presently planning to finance capital investments from its own funds.

Additional Amounts of Oil Supplies to China

Additional amounts of oil of Rosneft Oil Company, OJSC to be supplied to China at a level of 600 thousand tons are included in the export schedule for the first quarter of 2015 in the direction of the ESPO.

Maksim Grishanin also said that the cost of building the oil pipeline branch from the ESPO to the Rosneft Komsomolsk refinery will total about 47 billion rubles. Works will be financed by Rosneft. Transneft Vice President Aleksey Sapsay explained that this figure takes into account external power supply, but may be refined after the State Expertise approval.

Reorientation of High Sulfur Oil to the East

In 2015, Transneft started to redirect part of high sulfur oil volumes to the east. According to Maksim Grishanin, about 4 million tons of high sulfur oil are planned to be redirected this year. He also mentioned that the sulfur content in the ESPO shipped at Kozmino will not change.

Company's Deputy Vice President Igor Katsal added that Transneft continues to reduce the sulfur content in oil supplied to the Samara group of oil refineries, which are planned to be completed in 2016.

Company's Vice President Aleksey Sapsay said that the Krotovka LODS needs to expand its tank farm, build additional internal pumping stations and two compounding units. Several engineering measures will be implemented at the Kaleykino LODS and the Perm LODS to reduce sulfur in oil supplied to the Samara group of oil refineries.

Redirecting Cargo Flows to Russian Ports

Transneft redirects cargo flows from Latvian port Vetspils to Russian ports. According to Maksim Grishanin, in 2015 the amount of pipeline exports of Russian diesel fuel via Latvian port Ventspils will shrink from 5.5 million tons to 2 - 2.5 million tons. He added that, according to the 2015 results, approximately 3 million tons of diesel fuel that were previously transported via Ventpils will be redirected to Russian ports.

Transneft and Russian Railways (RZD) approved the tariff of diesel fuel transportation to the port of Novorossiysk, which will be attractive for consignors presently transporting oil products via Ventspils, said the First Vice President.

Works on the Tikhoretsk - Tuapse Oil Pipeline

An emergency situation mode (ES) in the Tuapse District following the incident on the Tikhoretsk - Tuapse-2 oil pipeline in December 2014 may be lifted by the end of this week, said Vice President Aleksey Sapsay. He added that as of December 30, 2014 all the works, associated with the incident liquidation, were completed, the shore and the bay area were cleaned.

An ES mode lift statement is being prepared. The maximum allowed concentration of oil products were not surpassed and a water analysis shows compliance with the applicable regulations. Aleksey Sapsay explained that the incident occurred due to violations made by the contractor engaged by Rosneft company.

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