Sovcomflot Group and China National Petroleum Corporation become strategic partners

The document was signed by the President and CEO of Sovcomflot, Mr. Sergey Frank and the President of CNPC Mr. Jiang Jiemin, in the presence of Mr. Igor Sechin, Deputy Prime Minister of the Russian Federation, and Mr. Wang Qishan, Vice-Premier of the State Council of the People's Republic of China, as part of a regular dialogue between Russia and China on energy matters.
 The agreement is the result of consistent joint work between Russian and Chinese specialists from SCF and CNPC (represented by its subsidiary - PetroChina International) aimed at the development of steadily growing and mutually beneficial cooperation between SCF – one of the world’s leading tanker shipping companies, and CNPC – one of the largest oil and gas companies in the world. At present, the Chinese economy is almost equal to the US in terms of the level of its energy consumption, while in terms of its rate of growth, it is the most dynamic developing country.
 In addition to the existing contracts, the parties agreed to develop a long-term partnership in the sphere of seaborne energy solutions, with the SCF fleet serving the continually growing Chinese imports of hydrocarbons. Taking into account the significant experience gained by Sovcomflot in developing the transportation of hydrocarbons in the Arctic seas, SCF and CNPC agreed upon the format for coordination in utilising the transportation potential of the Northern Sea Route, both for delivering transit shipments of hydrocarbons and for the transportation of oil and gas from Russia’s developing Arctic offshore fields.
 SCF, as one of the world’s shipping leaders, measured by the volume of its tonnage and by the quality of commercial and technical management of its fleet, decided to take advantage of an option to enter the sector of large-capacity VLCC tankers (of more than 300,000 dwt), which will be employed under long-term contracts for the transportation of CNPC cargoes. Vessels of this type will steadily expand the existing fleet structure of SCF Group and will strengthen its competitive ability in the world tanker market.
 The agreement provides for further development of the Russo-Chinese cooperation in enhancing the quality and safety standards for the seaborne transportation of hydrocarbons. It is proposed that Sovcomflot will provide assistance to its Chinese partners in training maritime specialists, on the basis of utilising SCF’s vessels, using first-class corporate training and simulators centres, and the facilities of maritime academies supported by the Group.

SCF Group is one of Russia’s largest infrastructure companies. Its fleet comprises 147 vessels (more than 10.7 million tonnes dwt in total). Its current shipbuilding programme includes 17 vessels (1.7 million tonnes dwt in total):
• The average age of tanker in the fleet is approximately 6.5 years (with the world average age being 12 years).
• The company has the largest fleet for operating in ice conditions, being the No.1 operator of Arctic shuttle tankers, as well as ice-class LNG carriers.
• SCF Group is the second largest operator (by deadweight) in the product tanker and Aframax tanker segments, holding fourth place in the Suezmax tanker segment.
• The Group provides its customers with hydrocarbon transportation services; crude oil trans-shipment using floating oil storage vessels; services for the development of effective logistics for energy resource transportation, towage of marine facilities, and specialized vessels’ for servicing offshore drilling and extraction platforms.
• The company has been a Lloyd’s List Global Awards finalist four times: twice, in 2007 and in 2008, reaching the finals in the category “Ship of the Year” and in 2005 was winner in the nomination ‘Newsmaker of the Year’; in September 2010 SCF Group became winner in the category “Company of the Year”.

China National Petroleum Corporation (CNPC) is an integrated international energy company.
Based in China, CNPC has oil and gas assets and interests in 30 countries in Africa, Central Asia-Russia, South America, the Middle East and the Asia-Pacific.
CNPC is China's largest oil and gas producer and supplier, as well as one of the world's major oilfield service providers and a globally reputed contractor in engineering construction, with businesses covering petroleum exploration & production, natural gas & pipelines, refining & marketing, oilfield services, engineering construction, petroleum equipment manufacturing and new energy development, as well as capital management, finance and insurance services.