REPORT SUSTAINABLE DEVELOPMENT2020 RNG JSC SUSTAINABLE DEVELOPMENT REPORT 3 ADDRESS CONTENTS FROM THE CEO ADDRESS FROM THE CEO ................................................................................................ 3 COMPANY PROFILE ............................................................................................................. 4 Resource Base ....................................................................................................................... 6 RNG JSC’s Goals .................................................................................................................... 8 RNG JSC’s Strategy ............................................................................................................... 8 Competitive advantages ................................................................................................... 9 Priority areas of sustainable development for RNG JSC ........................................ 9 Specifics of working in Yakutia ........................................................................................ 9 Timeline of important events in 2020 ........................................................................10 Key financial indicators in 2020 ....................................................................................12 Dear friends! Taxes and mandatory payments ..................................................................................12 Vladimir Rakitin Payments under contracts in favour The year 2020, when the whole world confronted the pandemic, evidently of state-controlled companies ......................................................................................12 showed how important it is to maintain a harmonious balance in all spheres Key production results in 2020 .....................................................................................13 of activity. RNG JSC invariably builds on the principles of sustainable development and ENVIRONMENT calculates success not only by financial and production success indicators. Environmental protection ..............................................................................................16 The company participates in the economic, social and cultural development of the Republic of Sakha (Yakutia). The extent of impact on the atmosphere .................................................................19 The extent of impact on water resources .................................................................20 RNG JSC is one of the largest employers in the Mirninsky district. We provide The extent of impact on land resources and biodiversity ..................................21 comfortable working conditions and protect the rights of each employee, Waste management ..........................................................................................................24 paying special attention to the issues of labour protection, preserving the health and safety of all staff. Our main reference point is a high level of The level of environmental opportunities ................................................................25 industrial safety. Over the past year, the company has done a lot of work to protect the team from the spread of COVID-19. We have provided significant SOCIAL POLICY assistance to the republic’s health care system. Human resource policy ....................................................................................................34 Traditionally, the company makes a substantial contribution to improving Employee social security .................................................................................................35 the quality of life in Yakutia. RNG JSC participates in large-scale infrastructure Labour protection and industrial safety ....................................................................39 projects, conducts sponsorship and charity activities, and provides support Contribution to regional development .....................................................................45 to small indigenous communities of the Far North. When RNG JSC started developing the Eastern blocks of the CORPORATE GOVERNANCE Srednebotuobinskoye oil and gas condensate field, a separate division in Corporate governance structure ..................................................................................54 the city of Mirny was registered. This ensured a steady flow of taxes to local Interaction with stakeholders .......................................................................................56 budgets. By the end of 2020, the company had transferred 4.7 billion roubles ($ 66.22 mil) of taxes and mandatory payments. Anti-corruption measures ..............................................................................................65 Our goal is the efficient use of natural resources and implementing projects without causing damage to the environment. RNG JSC ecologists regularly monitor the state of soil, air, and water resources, and actively implement environmental initiatives on the territory of the Republic of Sakha (Yakutia). We will continue to conduct our activities responsibly, contribute to the ABOUT THE REPORT development of the region and fulfil all obligations on matters of social responsibility. Dear readers! The methodological basis of the sustainable development report is based on the standards of the GRI (Global Reporting Initiative). RNG JSC annually publishes information on projects in the field of sustainable development on the official website and therefore adheres to the principles of transparency and openness in its work. The report reveals information about management approaches, activities and results to achieve economic efficiency, ensuring industrial and environmental safety, supporting and developing staff, promoting socio-economic development of the region of activity and respecting human rights. The report contains medium- and long-term plans. This information is of a forward-looking nature, since the feasibility of the stated intentions also depends on factors (economic, social and legal) that are outside the company’s zone of influence. In this regard, the actual results may differ from those indicated in the plans. 4 RNG JSC SUSTAINABLE DEVELOPMENT REPORT RNG JSC SUSTAINABLE DEVELOPMENT REPORT 5 COMPANY PROFILE RNG JSC is an enterprise of the oil and gas production industry based in the Far Eastern Federal The authorised capital of RNG JSC is 7.5 billion roubles ($ 101 mil). The main office of the District of Russia. RNG JSC was established in 2003 for the purpose of developing hydrocarbon company is in Moscow, while the offices of separate divisions are in Yakutsk, Mirny, Ust-Kut, raw materials and is part of the Eastsib Holding group of companies. Samara, Lensk, Irkutsk and at the field. The assets of RNG JSC are in Eastern Siberia, a region associated with the promising development of the Russian oil and gas industry. Since 2010, the company has held a licence for the exploration and production of hydrocarbons at the licence area «Eastern blocks of the Srednebotuobinskoye oil and gas condensate field» (EB By developing unique oil and gas fields in Eastern Siberia, RNG JSC directs the energy of natural SB OGCF), located in the Mirninsky district of the Republic of Sakha (Yakutia). SB OGCF is one of the largest fields in Eastern Siberia in terms of proven oil reserves. resources for the well-being of people. A modern, efficient and responsible approach to the organisation of work ensures the growth of the company and the welfare of its employees. In 2014, RNG JSC began the active development of the licence area «Eastern blocks of the RNG JSC is one of the largest employers and taxpayers of Yakutia. The goal of the company is Srednebotuobinskoye oil and gas condensate field». In 2018, the company started a trial pilot the effective development of oil and gas fields in remote areas with difficult climate conditions. operation of the field. On 29.08.2019, the solemn launch of the industrial operation of the RNG JSC is a high-tech business. The company constantly improves production indicators and Eastern blocks of the SB OGCF took place. The extracted oil is supplied to the Eastern Siberia- Pacific Ocean pipeline system. introduces innovative and digital technologies. To ensure the production of hydrocarbon raw materials at the field, RNG JSC constructs the necessary infrastructure: high-voltage power transmission lines, oil collection points, oil Following the principles of sustainable development is part of the company’s corporate culture, collection networks, water pipelines and reservoir pressure maintenance systems, as well as which is embedded in its long-term strategy. The company makes a significant contribution a network of technological passageways. The company makes a significant contribution to to environmental protection, paying great attention to labour protection and industrial the social and economic development of the Republic of Sakha (Yakutia) and successfully safety, and actively participating in social projects of the region, and developing international cooperates with local authorities. cooperation. 6 RNG JSC SUSTAINABLE DEVELOPMENT REPORT RNG JSC SUSTAINABLE DEVELOPMENT REPORT 7 Resource base Suldyukar Nyurbinsky "Rosneft" r. Vilyuy lgyattinsky Svetly "Rosneft" r. Vilyuy Chernyshevsky Arylakh Bakhchinsky South- "Surgutneftegas" Syuldyukarsky West Kempendyaysky “EastSib Holding” USRF* Bagdynsky "Surgutneftegas" “Live diamonds of Yakutia” Mirny Stanahsky Kuyabylakhsky