Russian Oil Companies Research Articles

Деятельность российских нефтегазовых компаний в Арктике: теория и практика резильентности в эпоху декарбонизации

Addressing global climate change presents a shared challenge, particularly for the development of the Arctic Zone of the Russian Federation (AZRF) and for industrial companies operating in the region, including oil and gas producers. Given the strategic role of hydrocarbon development in the AZRF for ensuring Russia’s energy security and the responsibility of oil and gas companies in reducing greenhouse gas emissions, it is critical to examine their role in enhancing the resilience of the AZRF amidst global decarbonization efforts. This article aims to provide a theoretical and practical analysis of the relationship between organizational and territorial resilience in the context of climate change. It focuses on the measures taken by Russian oil and gas companies to reduce greenhouse gas emissions and minimize the anthropogenic impact of their operations in the AZRF. The empirical basis for this study is drawn from the corporate reports of the largest Russian oil and gas companies. Through a review of contemporary Russian and international research, key risks to the resilience of economic systems in the AZRF are identified. A conceptual framework is proposed, highlighting the role of oil and gas companies in supporting the resilience of the AZRF, particularly through decarbonization initiatives aimed at mitigating the effects of climate change, such as permafrost thawing. Content analysis has been used to categorize the environmental and industrial safety measures, as well as decarbonization efforts, undertaken by Russian oil and gas companies in the AZRF. The study concludes by outlining the various decarbonization scenarios and strategies implemented by these companies in the AZRF.

Vliv případu Kardassopoulos proti Gruzii a případů investorů ropné společnosti Yukos proti Ruské federaci na prozatímní provádění Smlouvy o energetické chartě a na prozatímní provádění smluv z pohledu mezinárodního práva veřejného

The Energy Charter Treaty is a multilateral international treaty that contains regulations that, among other things, provide investors of other contracting parties with protection for their investments in the energy sector. Some States, including the Russian Federation, have provisionally applied the Energy Charter Treaty for several years in the wording of Article 45 of the Energy Charter Treaty. This provisional application under Article 45 of the Energy Charter Treaty raised issues that were considered in arbitrational and court proceedings. In this article, the author analyses several Awards on Jurisdiction and Admissibility of Tribunal, namely the Decision on Jurisdiction of Tribunal in the matter of Kardassopoulos v. Georgia and Interim Awards on Jurisdiction and Admissibility of Tribunal in the matter of investors of the former Russian Oil Company Yukos v. Russian Federation. The proceedings for annulment of Awards of the Tribunal in the matter of investors of former Russian Oil Company Yukos v. Russian Federation were brought before courts in the Netherlands, with the proceedings reaching the Supreme Court of the Netherlands, which decided the case on 5 November 2021. On the basis of the aforementioned decisions in the Kardassopoulos v. Georgia and Yukos oil company investors v. the Russian Federation cases, the author of the article focuses on the assessment of the effects of the provisional application of the Energy Charter Treaty, the interpretation of Article 45 of the Energy Charter Treaty, analysing the question of how the provisional application of the Energy Charter Treaty may be limited by the national law of the state that provisionally applies the Energy Charter Treaty.

Heterogeneous stock market impact of Russia–Ukraine War for oil and gas companies

Purpose This paper aims to examine the short-term market impact of the beginning of the military conflict between Russia and Ukraine (24 February 2022), the world’s largest oil and gas companies. Design/methodology/approach The authors examine the world’s 100 largest listed oil and gas companies at and around the beginning of the military conflict between Russia and Ukraine using an event study methodology. Findings The authors observe a positive and statistically significant stock price reaction at and around the military conflict. These results are consistent with the asset pricing perspective. Conversely, the stock market returns of Russian oil and gas companies, as well as those companies that were “forced” to divest in Russia due to corporate activism, exhibit a negative and statistically significant impact from the conflict. These reactions are reinforced or mitigated by company-specific characteristics such as size, profitability and institutional ownership. Finally, the findings indicate that companies engaged in oil and gas exploration and production report abnormally higher returns compared to firms in the other two subsectors of the industry. Originality/value The effect of the war on stock markets has been relatively little examined in the financial theory. This study intends to fill this gap in the literature.

THE ROLE OF GOVERNMENT SUPPORT IN THE DEVELOPMENT OF THE CCS MARKET: EXPERIENCE OF COUNTRIES WITH A DEVELOPED OIL AND GAS INDUSTRY

The article examines the role of government support in the development of the Carbon Capture and Storage (CCS) Technology market in countries with a developed oil and gas industry. It is shown that the implementation of CCS in the oil and gas sector has significant economic and environmental importance, as it allows not only to reduce the large-scale greenhouse gas emissions of this industry but also to increase the oil recovery factor through the injection of captured CO2 into depleted reservoirs. An analysis of the cost chain of various stages of the CO2 capture, transportation, and storage process is carried out, and the most costly elements are identified. The economic aspects of using Carbon Capture, Use, and Storage (CCUS) Technology for enhanced oil recovery are considered, and the need for government subsidies to ensure the commercial attractiveness of such projects under low CO2 emission prices is justified. The global experience of using economic instruments (carbon taxation, tax incentives, grants) to stimulate CCS projects in various industrial sectors is investigated. Significant differences in the approaches of leading countries compared to Russia are revealed. Pilot initiatives of the largest Russian oil and gas companies for the implementation of CCS technologies are analyzed. Recommendations are formulated for the creation of favorable regulatory conditions and effective mechanisms of government stimulation for the widespread adoption of CCS in Russia, taking into account its specifics as a major hydrocarbon producer.

Assessing the Decarbonization Progress of Russian Oil and Gas Companies

Assessing the Decarbonization Progress of Russian Oil and Gas Companies

Energy transition of the largest Russian oil and gas companies in the context of sustainable development of Russia

Subject. The article addresses prospects for using the renewable energy sources, the impact of greenhouse gas emissions on the Earth's climate. Objectives. The purpose is to determine relationship between environmental policy of the largest mineral companies in Russia and the principles of sustainable development, enshrined in international agreements. Methods. The study employs methods of comparative analysis. Results. We developed a rating methodology for companies, depending on the degree of their participation in the energy transition. In the process of energy transition, the largest Russian companies pay the most attention to technological improvement of oil and gas processing and production facilities. Conclusions. When designing long-term development strategies, Russian energy companies are increasingly focusing on compliance with the principles of environmental responsibility.

Повышение устойчивости компаний на основе принципов проектного управления

An effective company and project management system should ensure a balance between business objectives and the needs of society, contribute to the stable development of enterprises in an increasingly uncertain environment. Achieving such a balance requires a comprehensive implementation of the principles of the sustainable development concept in the activities of modern companies. Despite the significant increase in global investment in sustainable projects, today there are difficulties in the choice of methods for enterprises to improve their sustainability. The article substantiates the necessity of using project management mechanisms as a key tool for improving the sustainability of companies, considers standards and ways of adapting sustainable development goals to project manage-ment methodology. In addition, based on the results of analyzing the approaches of foreign and Russian oil and gas companies, specific measures for the introduction of sustainable development principles into the practice of project management are proposed.

Correction: Titova et al. Meeting the UN’s Sustainable Development Goals in the Decarbonization Agenda: A Case of Russian Oil and Gas Companies. Resources 2023, 12, 121

Text Correction [...]

Модель открытых инноваций как стратегический фактор технологического развития компаний нефтегазовой отрасли

The article is devoted to new methodological approaches and frameworks to develop innovative and technological potential of Russian oil and gas companies. Implementation and interconnection of innovative strategies with general corporate and digital transformation strategies are among the top priorities of industrial enterprises and may contribute greatly to successful functioning in competitive environment in the long-term perspective. Development of innovative and technological potential is crucial for Russian oil and gas companies due to the role that the oil and gas industry plays for the economy of the Russian Federation. In addition to traditional R&D management approaches, when the results of intellectual activity are generally developed in the internal perimeter where they stay lately, enterprises consider modern frameworks of innovation including open innovation model. Open innovation model includes constant interaction with the external innovation community. Competencies exchange and the integration of external innovative solutions have perspectives in terms of speed that technological and digital innovations are developed and implemented. On the one hand open innovation model helps to find perspective solutions to existing technological challenges, on the other it supports small innovative enterprises (startups) to develop and implement their technologies in real business.

ФОРМИРОВАНИЕ ЛОЯЛЬНОСТИ К БРЕНДУ РАБОТОДАТЕЛЯ НА ОСНОВЕ РЕАЛИЗАЦИИ СОЦИАЛЬНОЙ ПОЛИТИКИ ПРЕДПРИЯТИЯ

In this article, the author examines strategies for building loyalty to the employer brand among employees using the example of three successful Russian oil and gas companies. A sociological survey was conducted in the form of a questionnaire among potential applicants in order to identify the principles and criteria for the optimal way to attract personnel that highlight the company’s brand. Based on the results obtained, the author shows how the mechanism for building loyalty to the employer brand can be improved based on the implementation of the company’s social policy.

НЕФТЕГАЗОВЫЕ СДЕЛКИ РОССИИ: АЛЬТЕРНАТИВНЫЕ ПУТИ СОТРУДНИЧЕСТВА

Issues of developing alternative ways of cooperation in the oil and gas sector of Russia are being considered. Emphasis is placed on the need to diversify the economy of the oil and gas industry and search for new markets for Russian oil and gas companies. Alternative routes for oil and gas supplies are analyzed, such as Eastern Siberia – Pacific port, South Stream, etc., opportunities for cooperation with other countries and companies in the development and operation of oil and gas fields. The need for an active search and development of alternative ways of cooperation to ensure sustainable development of the Russian oil and gas sector is substantiated.

СТРАТЕГИЯ «ЗЕЛЕНОЙ» РЕИНДУСТРИАЛИЗАЦИИ: УПРАВЛЕНЧЕСКИЕ И ФИНАНСОВЫЕ АСПЕКТЫ

The article discusses the arguments related to the financial features of managing "green" industrial reindustrialization. The stages of evolution of business models of industrial enterprises within the framework of transition to sustainable development and technological sovereignty of the Russian Federation are described. The concept of "green" industry is interpreted, and its essential characteristics are revealed. The dynamics of changes in the eco-investment index values is presented and the forecast of the use of energy efficiency technologies in certain sectors of the Russian industry in the period 2021-2023 is presented. The paper discusses the results of the implementation of "green" renewable energy projects and the introduction of industrial eco-technologies by Russian oil and gas companies in the context of Russia's adoption of the updated Climate Doctrine. The article offers an interpretation of the volume of budget allocations for decarbonization, the development of alternative energy sources and the transition to a closed-loop economy in the draft Federal Budget of the Russian Federation for 2024 and the planning period 2025-2026 in the context of state programs and federal projects. The main directions of industrial policy within the development of the strategic scenario for the "green" reindustrialization of the Russian economy are proposed.

Search for an effective method to monetize the natural gas produced in Russia

The article discusses possible ways for Russian oil and gas companies to monetize the produced natural gas and diversify sales channels. Since 2022, there has been a decline in the economic efficiency of the development of gas and gas condensate fields in the Arctic zone of the Russian Federation. The root causes are the restriction of supplies to Western countries, the introduction of mechanisms to regulate the cost of hydrocarbons, the disruption of logistics chains, and the lack of prerequisites for the growth of domestic demand. The challenges currently facing oil and gas companies require comprehensive solutions. The actual challenges are increasing the value of produced hydrocarbons and diversification of sales methods. We consider the directions of gas delivery to the UGSS, its use as a fuel and raw material for power generation and gas chemistry. In the absence of a sales market near the autonomous fields, the most promising direction is deep processing of gas to produce products with high added value. Increasing the level of processing of hydrocarbon raw materials extracted from the fields is a driver for increasing the added value of the products sold. The main raw material for deep processing is natural gas prepared to marketable quality. Currently, its utilization as a gas chemical feedstock does not exceed 3.7%. Deep gas processing is characterized by high consumption of produced feedstock and access to a number of domestic technology licensors and equipment manufacturers. An alternative option is microbiological synthesis of protein from hydrocarbons. The prerequisite for the development of this direction is the growing demand for food products due to the increasing population of the Earth. The article presents a technical and economic evaluation of synthesis of feed protein from gas at autonomous fields in the north of Western Siberia. According to the results of a comparison of variants by protein content in the final product, component composition and specific cost, protein from hydrocarbons has the best characteristics. The main process of production is fermentation, and the equipment is a fermenter. The most modern technology involves the use of loop construction, the licensor of the technology is UniBio (Denmark). Among the consumers of feed protein are feed manufacturers, large livestock and poultry farms, fish farms. Studies of gaprin have confirmed the safety of its use as a feed additive. The implementation of deep gas processing projects will strengthen the stability of oil and gas companies in conditions of high market volatility.

Assessing the relationship between financial factors and the value of Russian oil and gas companies

Subject. The study analyzes the relationship between financial factors and the value of Russian oil and gas companies. Objectives. The focus is on the assessment of the impact of financial factors on the value of Russian oil and gas companies from 2018 to 2022. Methods. We employ the correlation and regression analysis to determine the relationship between financial factors and the value of companies. Such indicators as capitalization, revenue, operating profit, net profit, assets and equity of companies are considered as financial factors. Results. The analysis of Russian oil and gas companies (PAO Rosneft, PAO Lukoil and PAO Gazprom Neft) established a direct relationship between financial factors and the company value. So, PAO Rosneft has the highest correlation between revenue (0.965) and equity (0.954). For PAO Lukoil, the correlation coefficient between capitalization and revenue is 0.96, between capitalization and assets - 0.96, between revenue and assets - 0.99. For PAO Gazprom Neft, the correlation coefficient indicates a close relationship between the company's assets and equity (1.00). Conclusions. The results obtained can be applied in value management of oil and gas companies in modern conditions, in decision-making process in investment and management activities. The findings have practical and scientific significance and can be useful by investors, company executives, and analysts of the Russian oil and gas market to build more effective forecast models of capitalization of oil and gas companies.

Volatility spillovers across Russian oil and gas sector. Evidence of the impact of global markets and extraordinary events

This paper provides empirical evidence on the evolution of the impact of external shocks on the volatility connectedness of Russian oil and gas companies’ stock prices. We examine how the spillover structure has changed following the outbreak of COVID-19, as well as under the impact of the 2022–2023 events.We have extended the Diebold–Yilmaz approach to calculate conditional connectivity measures adjusted for the influence of global factors and unexpected shocks caused by extraordinary events.We use an augmented vector autoregressive model (VARX) to evaluate the adjusted conditional connectivity measures. The dynamics of connectivity indices are analyzed using the moving window method for VAR and VARX models, as well as using a dynamic model with time-varying coefficients (TVP-VAR). The comparison of adjusted and unadjusted connectivity measures allows us to draw conclusions about the impact of changes in foreign financial markets as well as shocks caused by extraordinary events on connectedness structure.We found that measures of conditional connectivity change much more slowly than unconditional ones. Our results support the hypothesis that essential part of the fluctuation of Russian oil and gas connectedness indices can be explained by exposure to unexpected shocks and global economic and political factors. Accordingly, the transformation of the network structure of risk transfer occurs quite smoothly, without sharp jumps and takes a considerable amount of time.

Ensuring the technological independence of oil and gas companies using patent analytics on the example of companies producing liquefied natural gas

The article analyzes technological development of the oil and gas industry in Russian Federation under international sanctions, as well as the directions of technology development and equipment production. The article purpose is to identify ways to achieve technological sovereignty in the industry. Patent statistics and construction of patent landscapes is considered as a method of choosing the direction of technological development. The study object is Russian oil and gas companies, while the main attention is paid to companies producing and distributing liquefied natural gas. The study subject is application of patent statistics for identifying trends and directions of technological development of the industry. The study result is determination of industry leaders, and the most promising areas of research in the field of means and methods of liquefied natural gas transportation, methods of its liquefaction or curing, as well as storage equipment. The article draws conclusions about the most promising technologies and patent trends, such as the creation of mobile plants for production of liquefied natural gas , including the construction of its own fleet of gas carriers and floating plants for the gas liquefaction to provide access to the infrastructure of offshore fields. In addition, for rapid development of new markets, the use of floating terminals for regasification is proposed. Approaches to assessing the innovation activity and competitiveness of companies have been considered.

Strategic Approaches to Ensuring Technological Sovereignty in the Energy Sector

This article discusses strategic approaches to ensuring technological sovereignty in the energy industry. Special attention is paid to the development of the Russian standardization system for oil and gas equipment and technologies based on the established Institute of Oil and Gas Technological Initiatives, which includes Russian and foreign oil and gas companies. Effective forms and methods of implementing import substitution programs, consolidating industry demand for oil and gas equipment and technologies, preparing standards and conducting conformity assessments of enterprises on them, as well as possible options for international cooperation based on the creation of a unified legal field in the field of standardization are proposed. The research carried out by the author made it possible to formulate strategic priorities for the implementation of domestic technological policy in the oil and gas complex, aimed at solving topical issues of import substitution and ensuring technological sovereignty. Ensuring technological sovereignty in the energy sector is a strategic task that requires consolidation of efforts at the state, industry and corporate levels of management.

Application of the theory of stakeholders in assessing the investment attractiveness of corporate structures

Purpose of the article is to describe the authors' proposal on the use of the concept of stakeholders in assessing the investment attractiveness of corporate structures, an alternative to traditional fundamental investment analysis.Methods: the basis of the research is the expansion of ideas about the factors affecting the investment attractiveness of the corporate structure on the basis of multi-subject assessments, in accordance with the theory of stakeholders.Results: currently, the investment attractiveness of a large corporate structure is formed under the influence of a variety of financial and nonfinancial factors that depend on actions or judgments broadcast (via the media, the Internet or other modern means of communication), not only by investors, but also by other interested parties. The approach proposed by the authors to assessing investment attractiveness differs in that it is based on the need to meet the information needs of various groups of stakeholders, not just investors. To achieve this goal, two interrelated tasks have been solved in the work. Firstly, the impact of factors influenced by stakeholders on the indicators of investment attractiveness is considered. Secondly, the assessment of investment attractiveness is carried out on the basis of information about the company's solution of environmental, social and other modern tasks.Conclusions And Relevance: the approach considered in the article, which involves the use of the theory of stakeholders to study the factors that influence investment attractiveness, has practical importance for corporate structures. The authors' calculations made on the basis of open information from one of the largest Russian oil and gas companies, PJSC Lukoil, confirm the hypothesis about the correctness of using the theory of stakeholders as another approach to assessing the investment attractiveness of the company. The calculations illustrate the significant closeness of the relationship between indicators traditionally used in assessing investment attractiveness and non-financial indicators that reflect the information needs of not only investors, but also other stakeholders (employees, customers, suppliers, financial institutions, the media, environmentalists, trade unions, etc.).

Meeting the UN’s Sustainable Development Goals in the Decarbonization Agenda: A Case of Russian Oil and Gas Companies

Being key players in providing sustainable energy on a global scale, oil and gas (O&G) companies can contribute to achieving the UN’s Sustainable Development Goals SDG 7 (Affordable and Clean Energy) and SDG 13 (Climate Action). This paper focuses on Russian O&G companies and presents an analysis of their contribution to these SDGs in the context of today’s decarbonization agenda. The study is based on a content analysis of their corporate sustainability reports and has produced three results. First, we analyzed the key strategic goals of Russian O&G companies. Second, we identified the correspondence between the progress towards the SDGs declared in their sustainability reports and the UN’s SDG indicators. Third, we analyzed the contributions of Russian O&G companies to SDGs 7 and 13. As a result of the study, recommendations were formulated to introduce practical tools aimed at increasing the contribution of Russian O&G companies to sustainable development. The article discusses problems in corporate sustainability reporting of Russian O&G companies. The paper also seeks to expand the existing literature on the contribution of the Russian O&G sector to providing sustainable energy and accelerating the energy transition in line with the decarbonization agenda.

Влияние стратегических рисков на реализацию проектов нефтегазовой компании

The article provides the analysis of strategic risks identification practices in Russian and international oil and gas companies. The lack of uniformity in approaches to strategic risks definition and identification processes were indicated during this research. The authors propose a formal approach to identify strategic risks and analyze their impact on the key performance in-dicators of oil and gas projects, based on the chain of strategic risks reflect-ing the causal relationship of its elements: factors of strategic challenges, strategic challenges, strategic threats (prospects), strategic risks (opportu-nities), consequences of strategic risks (opportunities) implementation. The impact of strategic risks on the key performance indicators of oil and gas projects is assessed through the comparison of the consequences after strategic risks implementation and key performance indicators of projects. This approach could be integrated into the risk management system of oil and gas companies at the level of strategic management, highlighting the following steps: collection and systematization of primary information about trends in the external environment; formation of strategic risk chains; impact analysis after strategic risks implementation on the key performance indica-tors of oil and gas projects.