3.4.The International Association of Oil Transporters. The Caspian Pipeline Consortium (The CPC)

The International Association of Oil Transporters

Since 2015, Transneft has been a member of the International Association of Oil Transporters (IAOT), founded in 2013 in the Czech Republic.

In 2019, two meetings of the Governing Board were held in Saint Petersburg and Almaty. The Association’s budget and work plan for 2020 were approved. The Croatian company JANAF was admitted to the Association as an observer.

At initiative of Transneft, a new permanent expert group titled “Efficient, Reliable and Safe Operation of Trunk Pipeline Systems” was established to discuss issues of inspection and repair of transport infrastructure facilities, including a methodology for quantifying the reliability of a pipeline system.

The permanent expert group conducted a comparative analysis of energy efficiency among IAOT companies for 2018 and six months of 2019 using a method developed by the Transneft R&D specifically for the purpose. Based on the analysis of energy consumption and recommendations for reducing energy consumption, the Association members were able to reduce the average specific electricity consumption by 12% for 2016–2019.

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The Caspian Pipeline Consortium (The CPC)

Transneft exercises trust management of 24% of CPC-R’s and CPC-K’s shares being in state ownership of the Russian FederationThe organisations comprising the Caspian Pipeline Consortium and registered in Russia and in Kazakhstan respectively.. The Company also owns 100% of shares of CPC Company, holding 7% of shares of CPC-R and CPC-K, and CPC Investments Company, which is the lender of CPC-R.

The CPC pipeline system is one of the largest investment projects in the energy sector with the involvement of foreign capital in the CIS. The length of the Tengiz – Novorossiysk pipeline connecting oilfields in Western Kazakhstan with the Novorossiysk marine terminal is 1,511 km.

The initial throughput capacity of the Tengiz – Novorossiysk oil pipeline stood at 28.2 MTPA. As a result of the Expansion Project completion in 2018, it increased to 67 million tonnes per year. In 2019, the CPC management bodies approved the implementation of the CPC Oil Pipeline System Debottlenecking Project to expand the throughput capacity to 81.5 million tonnes of crude oil per year.

In 2019, the CPC shipped 63.2 million tonnes of oil at the marine terminal in Novorossiysk, including 55.8 million tonnes of crude oil from Kazakhstani shippers and 7.4 million tonnes of crude oil from Russian shippers. The volume shipped at CPC’s marine terminal in Novorossiysk went up by 2.1 million tonnes (3.4%) in comparison with 2018.

In 2019, the CPC kept repaying its debt to shareholders. In 2019, the CPC paid a total of USD 202.9 million to the Russian Federation and USD 96.9 million to CPC Investments Company. In 2020, the Consortium plans to repay its debt to shareholders in full.

Caspian Pipeline Consortium (The CPC)
Caspian Pipeline Consortium (The CPC)