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Gazprom Neft concludes agreements with the Krasnodarsky Krai and the Sakhalinskaya Oblast on import substitution in lubricants

Press-release Efficiency Partnership

Gazprom Neft has used this year’s International Investment Forum Sochi-2017 to conclude a range of agreements directed at extending the geographic range of supplies of the company’s lubricants and ensuring the provision of Russian-produced goods to municipal and regional enterprises of constituent entities of the Russian Federation.

Under a cooperation agreement signed by Gazprom Neft CEO Alexander Dyukov and Governor of the Sakhalin Region Oleg Kozhemyako, Gazprom Neft Lubricants, operator of the Gazprom Neft lubricants business, will extend its supplies of Gazpromneft- and G-Energy branded products to the region’s urban and municipal enterprises — the priority here being import substitution, in energy, housing and utilities, and industry. Experts estimate that annual demand for lubricants in the Sakhalin Oblast today stands at 7,300 tonnes, more than 60 percent of which is imported. A similar agreement was concluded with the Krasnodarsky Krai. Under the terms agreed, Gazpromneft Lubricants will increase supply volumes of high-technology oils and lubricants for vehicle maintenance, technology for various purposes, and industrial equipment. Consumption of lubricants in the Krasnodarsky Krai is currently in the order of 19,000 tonnes per year, 25 percent of which is imported. This agreement will satisfy the needs of the region’s production and municipal enterprises, significantly reducing the region’s dependence on imports.

Gazprom Neft CEO Alexander Dyukov commented: “Production efficiency and product quality are what determines Gazprom Neft’s competitiveness in all segments of the petroleum products market. The lubricants market is no exception, and pursuing this business philosophy allows the company to increase sales of oils and lubricants even in the face of a general reduction in their demand in this country. Gazprom Neft lubricants’ compliance with the highest international standards, and their endorsement by leading global equipment producers, means we are able to further strengthen our position on the internal market, successfully replacing expensive foreign alternatives with high-quality domestic products. Import substitution is, today, one of the most important areas through which we are not only increasing sales volumes and expanding the geographic coverage of the areas we supply, but are also helping to develop the economy of Russia’s regions.”

Notes for editors

Gazpromneft Lubricants Ltd (“Gazpromneft Lubricants”) is a subsidiary of Gazprom Neft, specialising in the production and sale of oils, lubricants and service fluids. Established in 2007, Gazpromneft Lubricants Ltd has six production facilities throughout Russia, Italy and Serbia. Total production volumes stand at 500,000 tonnes of premium oils, lubricants and service fluids per year. The Omsk Lubricants Plant includes Russia’s most cutting-edge facility for the mixing, dispensing and packaging of motor oils, with a total annual capacity for blending and packaging of 300,000 tonnes per year. Management policies at Gazpromneft Lubricants and its production assets are fully compliant with international ISO standards, including ISO 9001, ISO 14001, ISO 16949 and OHSAS18001. The company supplies its products for production lines at Daimler KamAZ Rus, Rostelmash, Derways Automobile Company, KAMAZ, the Avtotor group of companies (producing Hyundai vehicles), GAZ Group, UAZ (Sollers), and BelAZ. The company’s products are used by corporate organisations including Severstal, SIBUR, Gazprom, Evraz, MMK (OJSC Magnitogorsk Iron and Steel Works), TMK, NLMK Group, RUSAL, ALROSA Group, Russian Railways, and other major industrial enterprises. The company’s product range includes 500 branded oils and lubricants across all market sectors (more than 1,200 products in total). The company’s products have received more than 250 endorsements from major equipment manufacturers including BMW, Mercedes-Benz, Volkswagen, Volvo, Renault, General Motors, Cummins, MAN Russia, ZF, KAMAZ, AvtoGAZ, Bosch Rexroth, and others. The company is also involved in the production and sale of marine lubricants, supplying products to Sovkomflot, Rosmporport, Rosnefteflot, Norilsk Nickel and other Russian and international fleet owners. Thanks to its integration with the global Chevron supply network, the company’s clients are able to obtain marine lubricants at more than 800 ports worldwide. The company currently commands a 15-percent share of the Russian lubricants market, as well as operating in the markets of the CIS and the Baltic States, Europe, Central and South—East Asia, Africa, and elsewhere. The company’s products are sold in more than 60 countries worldwide.