TNK-BP and Gazprom Neft have agreed to launch a project to optimize governance of the Slavneft group, which they own on a parity basis. The ownership structure of Slavneft will remain unchanged.
The project, which is subject to the finalization of certain corporate procedures, envisages that additional management and decision making authorities will be assigned by Slavneft’s corporate centre to its subsidiaries – OJSC Megionneftegaz, LLC Krasnoyarskneftegaz and OJSC Slavneft-Yaroslavnefteorgsintez.
The proposed changes imply that the shareholders will play a more active role in the work of the subsidiaries by appointing the members of their Management Boards and General Directors. As a result, the management of the production companies would run the day-to-day operations, draw up and implement their business plans, while key investment issues, such as the approval of production programmes and general oversight of Slavneft’s subsidiaries would be reserved for their Boards of Directors.
It is intended that the Board of Directors of OJSC “NGK Slavneft” will focus on strategic decision making, raising loans and asset acquisitions and divestments, while Slavneft will retain its corporate and financial governance functions.
Vadim Yakovlev, First Deputy CEO of Gazprom Neft, noted: “The aim of the project is to improve the company’s governance efficiency by transferring more authority from the corporate centre to the subsidiaries, over which the shareholders will exercise direct oversight. A similar arrangement has been in place since early 2011 for the management of Messoyakhaneftegaz – a company that we own jointly with TNK-BP - and has proved effective.”
Mikhail Slobodin, TNK-BP Executive Vice President, Strategy and Business Development, said: “The implementation of this initiative will enable us to optimize resources and manage Slavneft’s assets as efficiently as possible. Should the new business model be adopted it will allow the shareholders to employ the experience they have built up in managing production and refining assets and will also allocate responsibilities for managing new projects.”