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Centralized Power by
President Putin Energy Policy of Russia -energy superpower Russias Relation with European Union -diversify export market
Environmental concern
(Green): -Hybrid Car
Building up capacity to
deliver a new generation of Greenfield projects
CASE ANALYSIS : TNK BP (RUSSIA) 2008 DEMOGRAPHIC Russia ranks 178th in population density ECONOMIC Global economic crisis and resulting recession in 2008 GLOBAL Russia had 20% worlds large reserves of : oil
rates
Exchange Rates
-decline in Russian Rubble
Corruption remained
serious issue
PHYSICAL
-Transportation
PRODUCT SUBSTITUTES
Low - Minimal substitute for natural resources (petroleum/ gas)
- Other sources : Biogas /biodiesel/ synthetic oil/solar energy/nuclear energy ( not cost effective)
LUKOIL
Neftyanaya Kompaniya LUKOIL OAO (NK LUKOIL OJSC or Lukoil OAO) is a Russiabased integrated oil and gas company. The Company is engaged in the business of oil exploration, production, refining, marketing and distribution. It is an owner of refineries, gas processing, petrochemical plants and gas stations network located in Russia, Eastern and Western Europe. The Companys petroleum products are sold in the Russian Federation, the Commonwealth of Independent States (CIS) countries, Eastern and Western Europe and United States. Lukoil OAO operates through numerous subsidiaries and affiliated companies in eight business segments: Oil and Gas Production, Petrochemicals, Oil and Gas Refining, Petroleum Products Marketing, Services and Others, Financial Activity, Electric Power Generation and Banking. As of May 7, 2010, the Companys major shareholder was The Bank of New York International Nominees.
GAZPROM
OAO Gazprom, and its subsidiaries, operate gas pipeline systems. The Company is also a supplier of gas to European countries. The Company is engaged in oil production, refining activities, electric and heat energy generation. The Company and its subsidiaries are involved in exploration and production of gas, transportation of gas, sale of gas within Russian Federation and abroad, gas storage, production of crude oil and gas condensate, processing of oil, gas condensate and other hydrocarbons, and sales of refined products, and electric and heat energy generation and sales.
The Company sells its products, on the domestic market, as well as exports them to Europe and the Commonwealth of Independent States (CIS) countries.
The exploration and production segment is engaged in field exploration and development, and production of crude oil and natural gas.
The refining, marketing and distribution segment is engaged in processing crude oil and other hydrocarbons into petroleum products, as well as the purchase, sale and transportation of crude oil and petroleum products. Its primary investment in production sharing agreements (PSA) is through the Sakhalin-1 project (PSA 1).
PART II Situational Analysis D & E. Environmental Trends & Attractiveness of External Environment
Environmental Trends
Globalization BPs joint-venture with TNK in Russia to accommodate increasing oil and gas production and replacing reserves
Outsourcing Russia, worlds largest natural gas producer and second-largest crude oil producer
Expansion Russias proven reserves ranked number seven in the world, huge opportunities for further exploration
Strategic Alliance BP and AAR combine their interests in Russia to create the countrys third largest oil and gas business, in which both parties have a 50% stake (TNK-BP)
Expatriation Globalization created a global market for skilled professionals and levelled the income of skilled professionals relative to cost of living
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