Rosneft is the biggest consumer of goods, works and services among both Russian private and publicly owned companies. The annual scope of goods, works and services procurement by Rosneft and the Group companies from the third counterparts makes RUB 1.4 tln.
THE COMPANY IS FOCUSED ON LONG-TERM RELATIONS WITH SUPPLIERS
RUb 1.4 TRILLION
PROCUREMENT OF GOODS, WORKS AND SERVICES FROM THE THIRD-PARTY CONTRACTORS
2015 key achievements in procurement:
- To raise economic efficiency of procurements the Company (as a vertically integrated holding enterprise) performs consolidated procurement of goods, works and services for the group companies. Such approach conforms to the recommendations of the federal executive bodies (letter of the Ministry of Industry and Trade of the Russian Federation on improvement of procurement centralization No. NG-54957/05 of December 07, 2015). Materials and equipment procurement is centralized at Rosneft at the level of 79%, including Head office responsibility materials at the level of 60%, regional procurement operators with decision-making by the Head Office at the level of 10%, other regional procurement at the level of 9%.
- To get discounts for the scope and prices fixation in Rubles we turn to long-term agreements. The total amount of materials, equipment and works procurement under long-term agreements (including listed and framework agreements) in 2015 made RUB 260 bln (three-year demand). Moving towards long-term agreements the Company develops uniform requirements to procured products. Information on the annual demand in materials and equipment is posted on the Company’s website. The following long-term procurement agreements are already signed: wellhead equipment, metering units, well screens, pumps, oil submersible cable.
- To provide for the uniform principles and approaches to procurement the Uniform Company Regulation on Goods, Works and Services Procurement and Standard Procurement Documents are implemented at Rosneft and the Group companies. Besides the maximum transparency is provided by publishing procurement plans, information on procurement procedure and results, as well as on performance and conclusion of the relevant agreements (information on over 99 % procurements is available in the Internet).
- To raise efficiency of procurement operations SAP SRM System was implemented in 144 key Group companies. We also developed transparent system-level process from procurement planning through making decision of the result of procurement.
- To raise efficiency of procurement operations the Company initiated 3,399 procurements totaling RUB 652 bln and registered 6,247 suppliers at the CJSC TEK-Torg Electronic Trading Platform (the Rosneft Section).
- The Company is interested in long-term relations with the suppliers. The Company internal regulations provide for a long-term accreditation (18 months) significantly cutting costs of potential suppliers taking part in procurement procedures. The number of supplies accredited by the Company to take part in procurement grew on 8 % in 2015 compared to 2014.
- The Company is implementing the Import Substitution Program approved in 2015. The share of the procured Russian goods in 2015 made 83 %. The Company Regulation on Goods, Works and Services Procurement enables the Company to prioritize procurement of domestic goods, works and services in the cases and according to the procedure stated in the current legislation.
- The Company develops interaction with small and medium business entities. To expand the access of small and medium business entities to the Company’s procurement, we signed an agreement with the Federal Small and Medium Businesses Development Corporation and continuously perform operations in line with the standards and regulations of the Government of the Russian Federation. As required by Russian legislation, for the reporting period from July 01, 2015 through December 31, 2015 Rosneft concluded the agreements (including the Group companies’ agreements) with small and medium business entities totaling RUB 13.5 bln or making 28.5% of the estimated base. We actively communicate with the representatives of the regional authorities to engage small and medium business entities in procurement procedures and to raise their awareness.
