1. CEMENT LONG-TERM ACCESS TO FEEDSTOCK
Western Siberia has an abundant supply of oil and gas, as well as associated petroleum gas (APG) and raw natural gas liquids (NGLs) feedstock by-products of the oil and gas extraction process. A key objective of SIBUR’s strategy is to secure long-term access to this advantageously priced feedstock as the basis for growing our business. SIBUR’s extensive processing and transportation infrastructure gives major Russian oil and gas producers a unique solution for handling these by-products efficiently and generating revenues while reducing harmful emissions from on-field flaring to comply with environmental regulations.
In line with our objectives to expand long-term partnerships with the major Russian oil and gas producers, we have increased the weighted average maturities of SIBUR’s multi-year supply contracts to 17 years for both APG and NGLs.
2. MONETISE FEEDSTOCK ACCESS ADVANTAGE
As part of our strategy to monetise SIBUR’s Western Siberian feedstock advantage, we have invested significantly over several years to expand our production and transportation infrastructure. This includes major capacity expansions at our Tobolsk integrated production complex to increase SIBUR's processing volumes, a 1,100 kilometer pipeline to increase the flow of NGL feedstock from the Yamalo-Nenets Autonomous District to Tobosk, and export facilities in the Ust-Luga seaport to complete the value chain and increase our sales of fuel and energy products in international markets.
We have also launched several world-class petrochemicals facilities. This includes our Tobolsk-Polymer complex, one of the world’s largest polypropylene facilities, and the integrated complex is Kstovo, which comprises the RusVinyl PVC joint venture with Solvin and SIBUR’s ethylene cracker. These investments have enhanced the value, scale, efficiency and balance of our vertically integrated business – while demonstrating SIBUR’s engineering and project management expertise. In 2014, SIBUR started work on the largest petrochemicals project in the country’s history — the construction of the "ZapSibNeftekhim" complex.
3. CAPTURE DOMESTIC GROWTH OPPORTUNITIES
Russia’s demand for basic petrochemical products is projected to grow faster than many of the world’s developed economies. The country’s industrial and transportation infrastructure is being modernised, increasing the need for basic materials, and per capita use of various petrochemical products is also low by comparison to other markets. In addition, much of Russia’s demand for basic petrochemicals products up until now has been met through more expensive imports due to a shortage of domestic production capacity.
SIBUR is thus positioned to capitalise on the market’s longer-term growth opportunities, while increasing domestic market share and displacing imports in the near-term thanks to our new production facilities and capacity expansions.
4. PURSUE OPERATIONAL EXCELLENCE
We pursue operational excellence to increase efficiency, reduce risks and create a more powerful and sustainable business. We invest in technology and training to ensure the safety of our employees and surrounding communities, and to reduce our environmental impact.