OREANDA-NEWS. October 4, 2012. A presentation of TRANSNEFT's IFRS results for the first quarter of 2012 was held in TRANSNEFT JSC in September 2012. The event was attended by representatives of a series of Russian and foreign investment companies and banks. The meeting was chaired by M.Grishanin, the First Vice-President of TRANSNEFT JSC, who answered a number of questions asked by analysts regarding the Company’s financial activities.

In particular he told that TRANSNEFT JSC plans to increase the investment program in the year 2013 by 2 per cent – up to 110 billion RUR. “According to the plan, the investment program for the following year amounts 110 billion RUR”, he said and noticed that expenses for maintenance of the pipeline system of the Company and keeping it in operative condition is preserved at the level of about 120 billion RUR. M.Grishanin clarified that this sum consists both of expenses for oil pipelines and oil product pipelines, as well as for ports. The Company’s investment program for the year 2012 was planned in the volume of 107.6 billion RUR, though, as M.Grishanin clarified, it can be corrected in October because of inclusion of Kuyumba-Taishet oil pipeline into it. According to a preliminary estimation, the cost of the project shall amount 107.0 billion RUR.

According to M.Grishanin, TRANSNEFT already discusses the volume of the tariff for oil pumping through pipeline systems for the year 2013, provided that the Management of the Company considers it essential to keep the increase of the tariff lower the inflation tariff. Answering the question of analysts about the Company’s measures in case of acceptance by the Government of a decision on increase of dividend payouts, M.Grishanin noted that in such a situation the Management could apply to the Federal Tariff Service with a proposal of the tariff increase. “If collegial bodies will accept a decision on increase of dividend payouts, we will apply to the FTS with an application of the tariff increase”, - the First Vice-President said. Besides, he didn’t exclude that in such a situation the Company will have to take loans, but in the current conditions the Management doesn’t plan to change its index of net debt to EBIDTA which is close to “one”, and the Company is not intended to expand its loans yet.

M.Grishanin also said that TRANSNEFT will not allow increase of the cost of building of Zapolyar’e-Purpe oil pipeline after termination of its projecting because of technical difficulties that may arise during its realization. “The cost may be corrected to the higher side”, he said and reminded that the preliminary cost of the project amounts120 billion RUR. “The cost will be revised taking into consideration all the technical difficulties that we may face”, M.Grishanin added. For the moment the Company still leads engineering researches and develops design and estimate documentation.

According to M.Grishanin, the lowering of tariffs for Russian companies for pumping oil by Atasu-Alashan’kou route by Kazakhstan will not result in occupancy of the East Siberia – Pacific Ocean pipeline system. “It won’t result in occupancy of ESPO, but surely this is a competitive direction”, - he said. The First Vice-President noticed that TRANSNEFT expects that oil deliveries to the Asian-Pacific region shall be fulfilled by ESPO, not through Kazakhstan.