What projects will the bulk of the investment programme be spent on in 2017? How much higher might it be than the 2016 programme?
The main investments in 2017 will be spent on the development of major new fields (Novoportovskoye, Messoyakha and Prirazlomnoye), the implementation of the oil refinery modernisation programme in which the Euro+ (Moscow Oil Refinery) project is the main focus in 2017 and also on drilling at current production assets. The investment programme will be financed at roughly the same level in 2017 as it was last year.
Two major projects – Novoportovskoye and Messoyakha – were successfully launched in 2016. What oil production volume can we expect from these projects in 2017?
The launch of these projects was very important in terms of their impact on the Company’s economics. Technological infrastructure facilities were launched at the Novoportovskoye field for 5.5 million tonnes in 2016 and we expect to reach production of 5.5 million tonnes of oil in 2017. Commercial production started at the East Messoyakha field in September 2016. Drilling at the field will double in 2017. Messoyakhaneftegaz (a joint venture between Gazprom Neft and Rosneft) will pump roughly 3 million tonnes of oil into the Zapolyarye-Purpe oil pipeline by the end of 2017.
What are the plans for acquiring foreign assets in the near future?
When adopting investment decisions abroad, we are guided by the criteria for the effectiveness of projects, including compared with alternative options in Russia. We are looking at multiple foreign exploration and production projects, above all in regions where Gazprom Neft operates – the Middle East and Eastern Europe.
Does the Company expect to return to a policy of interim dividend payments?
First of all, the total amount of dividends to be paid in 2017 will significantly exceed the level of 2015, when the Company still paid interim dividends. One of the Company’s priorities is to increase the amount of dividends per share, which we consider the most important thing for shareholders and investors. As for the actual mechanism of dividend payments with an announcement of interim dividends, this decision will be made strategically depending on market conditions and the cash flow forecast.
What was the reason for the strong increase in the Company’s share value in late 2016?
We definitely saw rapid growth in the Company’s share quotes in 2016. This is primarily attributable to the price dynamics of oil, the Company’s main product. As we know, oil prices reached their lowest level in several years in January 2016 and were quoted lower than USD 30 per barrel. However, by the end of the year prices rebounded to USD 55 per barrel, i.e. almost doubled, given the agreement to cut production by OPEC and non-OPEC countries. Of course, oil prices are not the only factor that influenced the Company’s quotes. The main achievements by management that impacted the Company’s quotes include the launch of two large new fields, Novoportovskoye and Messoyakha (Gazprom Neft and Rosneft joint venture), as well as an increase in production at the only offshore field in the Arctic – Prirazlomnoye. This was all reflected in our financial results, which were well received by the market. In particular, our net profit soared by 82.5% in 2016 to RUB 200 billion. With the dividend policy remaining unchanged, this directly affects the amount of dividends to be paid for 2016 and was one of the decisive factors in the growth in the Company’s share value.