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Russian Petroleum Industry

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Herp Derpson

on 22 August 2013

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Transcript of Russian Petroleum Industry

The Russian Petroleum Industry
Socio-Cultural Factors
Physical Factors
What are the top 3 oil producing countries?

How much of the world's oil does Russia provide?
Mid Presentation Activity
Macro Economic Factors
The competition
Financial Factors
Final Recommendations for Businesses entering
the petroleum market
Final Questions?
Russia's leading extraction and refinement company

Majority owned by the Russian Government

106,000 employees
Russia's 2nd largest oil company

World's 2nd largest public oil company

150,000 employees
Russia's 3rd largest oil company

50% owned by British Petroleum, 50% owned by the Renova Group, a Russian conglomerate.

50,000 employees
1.850 Trillion nominal(2011)

Oil effects economy

Growth rate 4.3%
Disposable income in Russia $13,911

Disposable income in US $37,708

Top 20% $33,916 Bottom 20% $3,780
322.5 Billion

Main imports: machinery, vehicles and pharmaceutical products

Import Partners: China, Germany and Ukraine
520.9 Billion

Export Partners: Netherlands, China, Italy and Germany

Main Exports: Oil and natural gas

Oil accounts for 75% of all exports
Interest Rate
Last Reported at 8.25%
Central Bank of Russian Federation
Increased Private Sector Loans
Record High in June 2012
211,977,290,000,000 Rubles
Political Factors
Labor Laws
28 vacation days
Hazardous Work Retirement Age
Men: 55
Women: 50
Russian Culture
The traditional religion is Orthodox Christianity.
Other religions include Catholicism Islam, Buddhism and Judaism
There are three main dialects; Northern, Southern and Central
Trust is very important in and out of the office
Business culture
Patience is valued over punctuality
Appropriate attire is necessary
It is important to know the business hierarchy
They are very hesitant when working with strangers
Eye contact is important
Business hierarchy
It is important to know who you need to do business with
There is normally one person who makes strategic decisions
There is not much consultation from the central figure, it is a sign of weakness
Meetings are for giving information, not open debate
What to avoid
It is important to be on time, but if your Russian counterpart is late do not be surprised or angered
Do not rush them in a meeting, they like to have time to reflect on things before commenting or making a decision
Try to learn some Russian, it will help gain their trust
Even though it may be cold, it is rude to wear hats or coats past the door of any establishment
•North Asia bordering the Arctic Ocean, extending from Europe to the North Pacific Ocean
142,517,670 people = #9 in the world
(U.S. population #3)
Broad plain with low hills west of Ural Mountains

Siberia takes up roughly 77% of Russia's total territory

Vast forest and tundra in Siberia

Uplands and mountains along southern border regions

The "Great Steppe" area in the south
Largest country in the world in terms of area

Unfavorably located in relation to major sea lanes of the world

Lacks proper soils and climates (either too cold or too dry) for agriculture
физическфизических факторов
•17,098,242sq km
(1.8 times the size of the US)
Capital: Moscow
Density: 8.4 people per square km
Distribution: 74% urban, 26% rural
Growth Rate: -0.48%
Majority of population is between 15-64 years old (71%)
Subarctic temperatures in Siberia
Tundra climate in the polar north, winters are long and summers are short
Winters vary from cool along Black Sea coast to frigid in Siberia
Summers vary from warm in the steppes to cool along Arctic coast
Global warming poses issues and potential growth
Humid continental area in much of European Russia
Most extensive pipeline system in the world
The Baltic Pipeline System-1
Russian oil transport system operated by Transneft
Capacity: 76.5 million tons of oil per year
4 Major Elements
Baltic Pipeline System-2
Extension of the original system
Capacity: 10 million tons of oil per year
Expected upgrading to capacity of 50 million tons of oil per year
Completed in 2011 and entered in function in late March 2012
Owned and operated by the
Russian government

Largest oil pipeline system in the world

Transports ~93% of Russia's oil
InterNational Competitors
The Supermajors

British Petroleum Royal Dutch Shell
Chevron Total S.A.
Exxon Mobil ConocoPhillips
Saudi Aramco
The world's largest oil company in terms of both production and reserves

Followed by the National Iranian Oil Company, with the Iraq National Oil Company in the number 4 position.
Government Intervention
Russian government does not require ownership.
Russian government allows direct investment in the companies.
The world's largest publicly owned oil and gas companies:
Growth RAte
Government Involvement- the top 10 oil companies are all NOC's.
Patience is a virtue!
Loans are very easy to acquire
Bring a lot of warm clothes, but DO NOT WEAR THEM IN A MEETING!!!
Keep in mind that the main method for exporting is through pipelines, not waterways!
Proven World Oil Reserves as of 2009
Full transcript