PJSC Tatneft. Annual report 2017
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PJSC Tatneft. Annual report 2017

Sale of petroleum products

The refined products produced by the Company are sold in bulk abroad and in the domestic market, and supplied to Company's marketing subsidiaries for further sale in Russia. The total sales of refined products by the Group amounted to 10,5 million tonnes in 2017. The share of refined products supplied to the domestic market was 52,2%. At the same time, in order to increase the operating profitability, the Company increased the share of the refined product export to 44%, due to which the revenue from sales in this sector increased by 14% compared to the previous year. In 2017 the Group exported 5 million tonnes of refined products (including 185 thousand tonnes of purchased refined products) in comparison to 4,9 million tonnes in 2016 (including 104 thousand tonnes of purchased refined products).

Altogether, the revenue from the sale of refined products less export duties and excise duties amounted to 241,7 billion rubles in 2017 with an increase by 13,8% compared to the revenue of 2016, which occurred due to higher average prices of refined products. 5,5 million tonnes of refined products were supplied to the domestic market.

The most marginal sale channel of motor gasoline on the domestic market is the gas station network. TATNEFT is the operator of a retail network in the most attractive regions of Russia in terms of capacity and dynamics of demand and has a fairly large regional network. This ensures reliable sale of most of the motor gasoline of its own production. The share of sale of diesel fuel produced by TANECO on the domestic market is about 77% of total sales, with an average of about 42% for other oil companies. Thus, with 1.7% of the total volume of diesel fuel production in Russia, TATNEFT has 3.7% of the total volume of its sale on the domestic market. All available modes of transport are used for the shipment of diesel fuel to customers: railways, the pipeline system, self-delivery by road from the refinery and regional oil depots. Motor transport is more efficient and the Company’s own network is supplied mainly by direct transport from the refinery to the filling station.

The target markets for the sale of jet fuel are the airports of Tatarstan, the Ural Federal District, and the Central Federal District. The target domestic airports are those of Kazan, Nizhnekamsk, and Bugulma. Coordination of the types of fuel for the Ministry of Defense of the Russian Federation is also being studied. In 2018, the Company plans to create its own network of modern refueling complexes located at airports to sell the increasing share of jet fuel it produces.

SALES VOLUMES OF REFINED PRODUCTS BY THE GROUP, MILLION TONNES
REVENUE FROM THE SALE OF REFINED PRODUCTS LESS EXPORT DUTIES AND EXCISES, RUB BILLION
SHARES OF REFINED PRODUCTS SALES BY DESTINATION
SHARES OF REVENUE FROM REFINED PRODUCTS SALES LESS EXPORT DUTIES AND EXCISES DUTIES BY DESTINATIO

Tatneft annually takes part in the program of the supply of diesel fuel on preferential terms to agricultural producers for sowing and harvesting in the Republic of Tatarstan.

Fuel supply to agricultural producers, tonnes/year
2014 54 939,438
2015 63 907,141
2016 69 999,574
2017 63 056,719
TOTAL: 251 902,872