Rosneft Expands Cooperation in the Russian Gas Fuel Sector

| Russia, St Petersburg
Rosneft Chairman of Board Mr. Igor Sechin and Russian Machines Chair Mr. Siegfried Wolf sign MOU

Rosneft Chair Mr. Igor Sechin and Russian Machines Chair Mr. Siegfried Wolf sign MOU

Rosneft, Russia’s largely state-owned fuel producer, has entered into several Memorandums of Understanding (MOUs) at the recent International Economic Forum, for the expansion of natural gas as a fuel for transportation across the country. Agreements were reached with Barrens, a St. Petersburg-based compressor manufacturer; Iskra-Energetika, Perm-based constructor of gas turbine and combined cycle power plants, compressor stations and processing facilities for the preparation of associated gas; LLC TEGAS, a Krasnodar-based compressor manufacturer; and Russian Machines (a business group incorporating automotive holding GAZ Group).

Barrens has signed a cooperation agreement to expand the use of natural gas as motor fuel and boost Compressed Natural Gas (CNG) refuelling infrastructure throughout the Russian Federation in Russia, which is one of the key priorities of Rosneft’s strategy in retail business.

The signed document provides for implementation of joint technical and economic research for infrastructure construction. The companies also agreed to give consideration to construction of Rosneft filling stations using Barrens technologies. The companies will set up working groups to coordinate this activity.

TEGAS also signed a Cooperation Agreement with a view to expanding the use of natural gas as a motor fuel. The document defines the procedure and conditions for cooperation between the parties in the framework of measures to enhance the use of the compressor equipment produced by TEGAS for the needs of the Company. In addition, the parties have shown an interest in joining forces to develop the market of natural gas as a vehicle fuel and the need for coordination of actions for the development of gas fueling network and fleet running on natural gas.

As a result of the signing of the agreement, Igor Sechin, said: “The implementation of this agreement will contribute significantly to the development of the market of environmentally friendly and fuel, including, will contribute to import substitution process equipment to provide strategic security and development of the industrial complex of the Russian Federation.”

Iskra-Energetika has agreed to cooperate in the field of localization of production and supply of equipment for the facilities of natural gas, as well as the design and construction of gas fueling infrastructure. The document is aimed at uniting the efforts of companies to develop the market of natural gas as a motor fuel in the Russian regions. The Agreement defines the main terms of cooperation in the field of localization of production and prospective supply of equipment, construction and design of filling infrastructure.

Russian Machines, part of Basic Elements industrial group, has entered into an MOU to boost the use of CNG in vehicles and create CNG filling stations across the Russian Federation. The MoU also stipulates that the parties carry out shared technoeconomic research to create infrastructure and marketing framework for CNG as car fuel. Furthermore, it covers the shared arrangement of equipment design and testing with regards to Rosneft NGV filling stations. By 2023, the company expects to commission up to 1,000 NGV filling stations.

As a result of the signing of the agreement, Rosneft Chairman Igor Sechin said: “The implementation of this agreement will contribute significantly to the development of the market for this environmentally friendly fuel, including facilitating the creation of advanced domestic manufacturing equipment.”

Siegfried Wolf, BoD Chairman of Russian Machines and co-signer of the agreement, stated that “the promotion of natural gas-driven transportation market in Russia is one of the top priorities pursued under our corporate strategy. We’re a leading domestic manufacturer of CNG commercial vehicles, including LCVs, buses of various classes and trucks. In 2015 we introduced our proprietary gas filling module that was commissioned in Nizhny Novgorod. I believe that expanding cooperation with Rosneft will further favor the introduction and localization of up-to-date gas filling technology.”

All above parties intend to conduct joint feasibility studies, the results of which will identify specific investment projects for implementation.

Increased use of natural gas for transport is expected to generate substantial savings in fuel costs and reduce the negative impact on the environment.

(Source: Rosneft)

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