Operating results

Overview of international oil refining assets and projects

Rosneft Deutschland GmbH (RDG)

The Company entered the German petroleum product market in 2011 when it acquired a 50% stake in Ruhr Oel GmbH (ROG). Following ROG reorganisation in 2016, Rosneft gained direct control over more than 12% of Germany’s oil refining capacities, with a total throughput capacity of about 12.5 mmtpa. The Company became a shareholder in three major refineries: Bayernoil (12.5%), MiRO (12%), and PCK Schwedt (35.42%). It then doubled its shares in the refineries to 25%, 24% and 54.17%, respectively. At the same time, BP accumulated a 100% share in the Gelsenkirchen Refinery.

In December 2019, Rosneft Deutschland GmbH closed the deal to acquire 3.57% of shares in Bayernoil Raffineriegesellschaft mbH from BP Europa SE, increasing its stake to 28.57%. As a result, the Company saw its share in the refining capacities of Bayernoil grow to almost 3 mmtpa, with its total throughput capacity at German refineries reaching 12.8 mmtpa, which strengthened its positions both in Bavaria, one of the largest industrial regions of Germany, and in Austria.

Rosneft is the third largest player in the German oil refining market. Operating activities are carried out by its subsidiary, Rosneft Deutschland GmbH, established in 2017. Rosneft supplies almost a quarter (about 23 mmtpa) of crude oil imports to Germany.

Following the joint venture restructuring agreement, Rosneft and BP decided on the gradual adaptation of the petroleum product sales chain to ensure full and timely performance under the contracts with refinery customers during the transition phase, which was completed as scheduled.

On 1 January 2019, Rosneft Deutschland GmbH initiated direct sales of petroleum products manufactured at the three German refineries partially owned by Rosneft. The product mix includes gasoline, diesel, heating oil, jet fuel, LPG, bitumen, fuel oil, and petrochemical products. The Company is a leader in the German petroleum wholesale market.

Apart from direct supplies from its refineries, the Company uses over 30 export terminals in Germany to deliver petroleum products by road, rail, and river. The company’s customer base includes more than 600 enterprises in Germany, Poland, the Czech Republic, Switzerland, Austria, and France, as well as Turkey, Singapore and Thailand.

The company owes the success of its large-scale sales to the similar experience it had with bitumen supplies in 2018. That year, Rosneft Deutschland GmbH was supplying its products to over 130 customers across Germany.

Apart from that, Rosneft Deutschland GmbH signed contracts on into-plane fuelling with airports in Munich, Berlin and Stuttgart to expand its jet fuel market presence in Germany. In the reporting year, customers of Rosneft Deutschland GmbH were successfully transferred to the new Berlin Brandenburg Airport.

MiRO GmbH & Co. Refinery KG is located in Karlsruhe, Baden-Württemberg. This is the largest oil refinery in Germany and one of the biggest and most innovative plants in Europe. Capacity – 14.9 mmtpa (Rosneft's share – 3.6 mmtpa), the Nelson Index – 9.4.

PCK Raffinerie GmbH is located in Schwedt, Brandenburg. Thanks to its location, it can be supplied with Urals through the Druzhba pipeline. Capacity – 11.6 mmtpa (Rosneft's share – 6.3 mmtpa), the Nelson Index – 9.8.

Bayernoil Raffineriegesellschaft mbH supplies fuel to Bavaria and northern Austria. Capacity – 10.3 mmtpa (Rosneft's share – 2.9 mmtpa), the Nelson Index – 6.8.

As a shareholder of PCK Refinery in Brandenburg, Rosneft Deutschland GmbH supplies about a half of the total kerosene consumed at Berlin airports. Due to COVID-19 restrictions, jet fuel output decreased in 2020.

As part of the initiative to create a marketing function, Rosneft Deutschland GmbH deployed an advanced enterprise resource planning system SAP S/4HANA. The deployment project turned to be the largest in the European oil and gas industry and one of the biggest worldwide in terms of data volume transferred. S/4HANA is a top-notch resource planning solution.

Mozyr Refinery

The Company indirectly holds a 21% stake in the Mozyr Refinery (Belarus) through Slavneft. In 2020, Rosneft’s share in the throughput of the Mozyr Refinery amounted to 1.9 mmt. The Company is completing its investment project to construct a heavy residue hydrocracking unit scheduled to be launched in 2021.

Nayara Energy Limited

In August 2017, Rosneft closed the deal to acquire 49.13% of shares in Essar Oil Limited (renamed Nayara Energy Limited in May 2018), an Indian company that owns a major refinery in Vadinar and a retail chain of filling stations across India.

The Vadinar refinery has a capacity of 20 mmtpa and ranks second in the Indian market by throughput. It is among the world’s Top 10 most complex refineries, with a Nelson Index of 11.8. It is highly flexible as it can process heavy and extra-heavy crudes, which account for over 90% of its annual throughput, and has achieved high operational efficiency for its assets.

The refinery owns a deep-water port that can accommodate VLCC supertankers, while its power station independently provides ample power supply.

Nayara Energy Limited runs a large network of filling stations under the Essar and Nayara brands in India. As at the end of December 2020, the network included 5,975 operating stations and had three in-house and 13 rented oil depots.

Nayara Energy Limited operates in 30 out of 36 regions of India and accounts for around 5.8% of the Indian market in terms of sales. The company is planning to increase the number of filling stations to 7.6 thousand by 2024, selecting the most promising territories for development.

Nayara Energy Limited is implementing a phased development programme for its Vadinar refinery.

In October 2020, the Board of Directors of Nayara Energy Limited made a final investment decision to green-light the first phase of this programme.

During this phase, the company will reconstruct the catalytic cracking facility and build new polypropylene production units with an annual capacity of up to 450 kt.

Success