COMPANY PROFILE

STATEMENT OF COMPANY

SOLUTION TO SITUATION

In order for the present condition to exist and satisfy the electrical needs for the Primorye Region. According to point 4.1.3.4. of the Resolution of the Government of Russian Federation ? 169, Marth,19th , 2002 "On the Federal special purpose program on Economical and social development of Far Eastern and Baikal Regions on 1996-2005 and up to 2010 "realization of the project of building Primorye Oil and gas Complex are planned on the territory of Phokino-ciy of Primorye Region. Primorye oil and gas complex will be consist of:
* Steam and gas power station with a designed capacity of 500 megawatt,
* Plant of re-gasification 0f 1milloin tons of nature gas a year with gas terminal,
* Oil-refining plant with productivity of refining of 4 million tons of crude oil a year.



The requirements of power carriers for re-gasification plant and oil refinery will be satisfied by their extraction from oil and gas from the deposits on the shelf of Sakhalin island. In future this will be done by the hydrocarbons, which are planned to transport from Eastern and West Siberia toward the coast of the Sea of Japan by means of main oil and gas pipelines.

At present for realization of the project of building the Primorye oil and gas complex the following works are done:

* The decision of the Duma of Primorye Region and the decision of Governor of Primorye Region on building of Primorye oil and gas complex were issued,
* The decision of Joint commission on placing the productivity forces of Primorye Region ? 11-32/2748, December 19th,, 1998, was issued.
* Works on "The substantiation of investments" are finished on the whole,
* The area of 236 hectares in the district of the Bay of Chazgma and the area of 100 hectares in the district of Bay of Rasboynik were allotted and agreements were received in according departments.
* The radiological survey of the Bay of Chazgma and the Bay of Razboynik (land territories and sea territories on the allotted lots.
* The scheme of placing objects of POAGC on the allotted territories and rout of movement of ships in the Bays of Chazgma and Razboynik were approved.
* The project and project decision were worked out
* The topographical and geological works were done.

* The documents for substantiation of estimate of influence of the complex on surroundings.
* The state examination of Ministry of Defense of Russia was done.
* The concordance of Ministry of emergency situation and Ministry of interior affairs were received

Primorye oil and gas complex includes the following units:

Oil-refining plant ;For refining 4 million tons of crude oil a year.

Gas terminal: For reloading of 4 million tons of liquefied nature gas a year,

Steam and gas power station: With designed capacity of 800 megawatt.

Location: Russia, the South of Primorie Region, The Bay of Chazgma
and Razboynik, the Sea of Japan

Beginning of construction - 2002 year.

The stages of construction:

1st stage - oil-refining plant, putting into operation - 2004,
2nd stage - gas terminal, putting into operation - 2006,
3d stage - steam and gas power station, putting into operation - 2007.

Oil refining plant

The project of the oil-refining plant of POAGC will be oriented to working with oil deposits on the shelf just off Sakhalin Island. Eastern and Western Siberia through the transport oil main pipelines with the commodity market in Primorye Region.



Characteristics of Oil-refining plant

The oil-refining plant consists of the following main technological units:

1.Unit of demineralization and de-gidration of oil,
2.Unit of atmosphere pipe still,
3.Unit of napht reforming,
4.Unit of motor petrol compounding,
5.Unit of the production of jet engine fuel on the kerosene fraction.

The main units of all-plant equipment

1.Sea wharf equipped for receiving the oil tankers and dispatch of oil products into tankers.
2.The raw material stock consisting of 5 reservoirs with capacity of 50 000 m3 each
3.Reservoir stock of commodity oil products with total capacity of 230 000 m3
4.Railway trestle bridge for pouring light and dark oil products
5.Motor car trestle bridge for pouring oil products
6.Power equipment complex
7.Boiler-house
8.Repair-mechanical shop
9.Industry and firewater supply system
10. Central plant laboratory
11.Other subsidiary units


The feeding crude oil is planned to realize through the receiving terminal in the Bay of Razboynik and transport oil pipeline from Eastern Siberia

The gross volume of commodity output - 3 762 400 tons per year, including:

* liquefied propane-butane 26 400,
* motor petrol - 624 000,
* jet-engine fuel 300 000,
* diesel fuel, summer, 681 000,
* diesel fuel, winter, 545 000,
* ship power-generating fuel,
* brand DT,DM 321 000,
* marine residual oil, F-5 200 000,
* fuel oil, M-100 1 005 000
* Paving bitumen 61 000.


2.Delivery of raw material on the oil-refinery



The choice of raw materials for refining on the plant in many respects determines the following:

* Scheme of transportation of delivery of oil,
* Technological scheme of oil-refining production,
* Current expenditure on production of oil-products,
* Technical and economical characteristics of the
plant as a whole.

The oil will be delivered by the sea way from the deposits of Sakhalin island and by transport oil pipelines from Western Siberia.

3. The commodity market of finished oil products

The given commodity market is characterized by presence of two component parts - assortment of oil products consumed on the land and on the sea.

The land part of the commodity market of oil product in Primorie Region consists of the following parts:

1. Power and heat producing capacities of "Dalenergo".
The necessity: 300-400 thousand tons of fuel oil, M-100, a year.

2.Heat producing capacities of communal enterprises of Primorie Region
The necessity: 750 -800 thousand tons of fuel oil, M-100, a year.

1. Industrial consumers
2. The necessity per year: 500 thousand tons of diesel fuel (350 thousand tons summer, 150 thousand tons winter)
50 thousand tons of low octane gasoline,
250 thousand tons of avia kerosene

4.Retail network of the realization

The necessity per year:

Diesel fuel, summer: 100 thousand tons
Diesel fuel, winter: 200 thousand tons
High-octane gasoline: 500 thousand tons,
Low octane gasoline: 100 thousand tons
The total volume of realization: 2 500 thousand tons a year.

To estimate correctly the sea part of market of oil products isn't easy. The following estimation of supposed realization of oil products could be realized:
* Diesel fuel and its modification: 1 million tons a year
* Marine residual oil, F-5: 300 thousand tons a year,

Thus the whole capacity of market of Primorie Region is equal to

* Fuel oil, M-40|100 - 1200 thousand tons a year,
* Marine residual oil, F-5 - 300 thousand tons a year,
* Diesel fuel of all modification - 1800 thousand tons a year,
* Aviakerosine - 250 thousand tons a year,
* High-octane gasoline - 500 thousand tons a year,
* Low octane gasoline - 100 thousand tons
* The total volume - 4 million 100 thousand tons a year.

The sea part of market is perspective on expansion the sale of oil products typical for it. The characteristic feature of this component part is possibility of delivery at ships not only basing on the seaports of Primorie Region but at ships of the other regions of Far East (Kamchatka, Sakhalin, Magadan) calling at the ports of South part of Primorie Region.

The finished product delivery to the consumers will be carried out by three ways:

- Motor transport,
- Railway transport
- Sea transport.

The gross volume of commodity output of oil refining plant is 3 762 400 tons per year.

The total volume of investment in the construction of oil-refining plant is estimated at 375.8 millions US dollars.

Financing construction of "Primorie oil and gas complex" is planning at the expense of the investment of foreign companies.

Repayment of credit is planning at the expense of the sale of oil refining products.

The calculation of economical effectiveness of the project of construction of oil refining plant is given in the table. .

4.The terminal of liquefied natural gas



The terminal of liquefied natural gas (LNG) is oriented on the gas of deposits on the shelf of Sakhalin island according to "Sakhalin-1,2,3" projects taking into account of forecasted gas output level from the countries of Asian-Pacific Region. Gas sea carriers will carry out LNG delivery with commodity markets in Primorie Region.

In the submitted information about the construction of the terminal of LNC The Federal special purpose program "Gasification of Sakhalin, Khabarovsk and Primorie Regions" issued by the Government of Russian Federation (Resolution ? 852, July, 14th, 1999) is taken in account.

1.Characteristic of the terminal of LNG

The receiving LNG terminal is consists of the following main technological units:

* LNG tanker,
* Moorage with LNG draining equipment,
* LNG reservoirs with immersion pumps,
* Pump-house of LNG feed with buffer vessel,
* Re-gasification station,
* Compressor house of evaporating gas,
* Gas measurement station,
* Steam and gas power station,
* Torch equipment,
* Auxiliary structure,
* Automatization,
* Cross-country gas pipe-lines -272 km,
* Gas vents,
* Distribution network - 4997.6 km,

The planned volume of production, tons a year

Liquefied propane-butane liquefied propane-butane

2.Delivery of LNG

LNG delivery to the terminal will be carried out by gas sea-carriers of displacement up to 125 thousand tons.

"Sakhalin-1,2 & 3" projects envisages the transportation of nature gas through gas pipe line from settlement of Val to settlement of Prigorodnoe (Sakhalin island) where nature gas will be liquefied on the LNG plant and then LNG will be transported to the countries of Asian-Pacific Region and Primorye Region of Russia. Maximum planned volume of gas delivery to terminal is equal to 4 millions tons a year.

On the route of gas transportation from Sakhalin to Primorye one gas sea-carriers of capacity of 150 000 m3 is planned to use. This gas sea-carrier will ensure LNG delivery in the volume up to 4 million tons a year.

3.Commodity Market

With the crisis situation and the condition of lack of coal in storehouses the necessity of fuel oil is sharply increased. Supposed expansion of industrial production is connected with the growth of the necessity of fuel, heat and electrical energy. If the usage of gas will remain on the present level that 13,2 million tons of oil fuel is necessary to deliver to Primorye Region

LNG delivery to Primorye Region via receiving LNG terminal allows changing the structure of fuel balance and reducing the needs of coal and fuel oil considerably. The gas portion in the fuel balance in 2020 year will increase to 70 %. The total effect of gas using consists of 17-dollars/1000 m3. The throwing the harmful substances in atmosphere will be decreased. The enterprises of "Dalenergo" and communal enterprises will be reconstructed on cheaper sources of receiving of electric power and heat supply -natural gas.

Calculated necessity of natural gas in Primorye Region

Graph 1

The total volume of capital investment will be equal to 565,88 millions US dollars not counting the cost of the construction of steam and gas power station on the following positions:

 Graph 2

Financing construction of reception terminal of LNG is planning at the expense of the investment of foreign companies.

Repayment of credit is planning at the expense of the sale of LNG to consumers of Primorie Region.

The calculation of economical effectiveness is given in the supplement. .

Heat Power Station (HPS)

The heat power station of total capacity of 750 megawatts consists of the following units:

Three steam and gas units with capacity of 250 megawatts each including
- one gas-turbine units type of 501 F "Mitsubishi Yeavy Industries" with capacity of 159 megawatts,
- one waste-heat boiler of Russian production

Kinematical scheme - one shaft monoblock

Using the heat of live steam extraction from steam turbine will ensure delivery of heat to consumers in the form of superheated vapor, in the quantity 0f 400 hakacalorie's per hour. The efficiency of production of electric power (condensing conditions) is equal to 55%. The efficiency of useful utilization of fuel is equal to 80%.

The consumption of electric power for own needs:
For delivery of electric power - 2.7%,
For delivery of heat - 17.5 kilowatts-hour/hekacalorie

In this case the following consumption of fuel is ensured:

* Specific consumption of equivalent fuel for delivery of electric power: 0.222 kg /kilowatt-hour.
* Specific consumption of equivalent fuel for delivery of heat - 132 kg /hekacalorie.

The cost price (in the case of fuel cost -140 USD for 1000 m3 of LNG):
* Electric power - cents / kilowatt hour (including the fuel part - 0.68 cents/ kilowatt-hour.
* Heat USD/hekacalorie (including the fuel part - 6.5 USD/Hekacalorie)

The fuel using on the heat power station is liquified natural gas. The cold received during the re-gasification process is used for creation of lower vacuum in condensing turbines and for practical needs (frozen foods and so on).

The quantity of cold using during the process of re-gasification of LNG - 80 hekecalories/hour is using to deepen the vacuum in the condenser of steam turbines (up to 0.035 MPa)

Suggestion for manufacturing gravitation type foundation of sea ice proof platforms in the dry dock in the district of the Bay of Chargma in Primorie Region

The main criterion determining the choice of optimum placing if the sites of manufacturing of the platforms are the followings:

· Availability of nature and climatic conditions, ensuring the qualitative fulfillment of works on platform construction;
· Availability of comfortable unoccupied seaside territories, allowing the placing of the units of construction industry and its infrastructure.
· Availability of the natural depths ensuring a little volume of bottom deepening;
· Possibilities of the providing with construction materials, water and power resource.
· Developed network of motor-car roads and railway;
· Possibilities of the construction enterprises disposed near the district of the platform construction;
· Possibilities of the making up of the manpower on the new-established production of the platforms.
· Social and life infrastructure of platform manufacturing

Chosen site for construction of platforms is situated on Western coast of the Bay of Charzhma in 10 km fart from Fokino city.

In the late of 70s the construction base was organized, building site-engineering prospecting was done. Project documentation was worked up. The building works have been started. In the middle of 80s the formation of territory has been complied, bottom-deepening works on the approaching channel to the dry dock have been done and the other coast units have been built.
The rough foundation area of the dock with taking out the soft soil and the construction of cofferdam were done.

The water area dimensions of the construction foundation area behind the existed cofferdam are approximately 375x70 m depths are from 1 to 16.5 m in accordance with soundings made in November, 1997.

According to depth parameters foundation area has two pronounced sections:
- Swallow water section with dimensions of 260x210 m and depth up to 1.4 m (northern section)
- -Deep- water section with dimension of 370x210 and depth from 6 to 15.3 m (southern section)

During the period from 1998 to 2000 the necessary concordance of Ministry of Defense were received, in 2000 the area of 100 hectares was allotted. On the base of this land allotting Private Joint-Stock Company "Primorie Oil and Gas Compex" has received the permission on projecting the construction.

The chosen site for construction of sea ice-proof platforms has the established infrastructure at present. It consists of:

· Foundation area of non-complied dry dock
· motor car roads,
· spur track railways,
· electric power lines,
· communication facilities,
· water pipe-line, 500 mm diameter,
· sea wharf, 360 m, with depths of 13 m,
· approach channel for withdrawal of the platforms to the free sea with depth of 13 m,
· hydrological works and inspection of the existing wharf embankment with length of 360 m were made,
· topographical and geological investigation of the construction size was made,
· ship-repairing plant which infrastructure will be used during the construction of platforms,
· stone quarry with the whole stock of hydro-technical stone of 19 million cubic meters at a distance of 5 km from the construction size,
· Sand quarry with the whole stock of sand of 2million cubic meters near Rechitsa village at a distance of 35 km from the construction size.
· open and close storehouses for storage of materials,
· contract construction organizations directly specializing on the hydro-technical structures in cities of Fokino, Nakhodka and Vladivostok,
· availability of skilled manpower in Dunay settlement and Fokino city,
· habitation and social and cultural conditions of life,
· Cement: city of Spassk-Dalniy. Delivery by railway and motor-car transport.
· Pre-project materials of dry dock for building two platforms with dimensions of 110x110 m.

Conclusion

1.Acceptence of principle construction decisions on building dry dock in district of the Bay of Chazhma, Fokino-city, for manufacturing dwell platforms in accordance with project"Sakhalin-1" and "Sakhalin-2" gives the opportunity to its placing on considering site.

2.The considering site for building sea ice-proof platforms has the following main advantages on comparison with other non developed sites:
* Existing production infrastructure including both newly built units and the capacity of existed ship-repairing plant,
* Availability of engineering-geodesic and engineering-geological prospecting the construction site.
* Readiness of the first stage of works for organization of construction foundation area of dry dock: completing the rough foundation area and construction of coffee-dam,
* Availability of quarries of construction materials: stone of 19 million cubic meters and quarry with the whole stick of sand of two million cubic meters.
* Availability of approaching channel for withdrawal of the platforms with depths of 13 m.

3.For construction of considering production complex contract construction organizations specializing on the hydro-technical and industrial construction and situated in cities of Fokino, Nakhodka and Vladivostok can be enlisted.

4. Using the non-completed building production allows to reduce the duration of construction of production basis for manufacture of the platforms on the given building site in comparison with new territory on 1.5 years. The variant of dock of slope shape offered by "Vostokproektverf" institute will have the following advantages: simplicity in building,
cutting of expenditure of construction materials and structure, shortening of duration of construction possibility of earlier laying of first platform on the building slip.

5. The construction of dock and building platform may be combined with the ending of the works to cut the duration and cost of construction.

6. The whole duration of earthwork on completing the dock will be 9-10 months approximately.

7. The technical equipment of ship-repairing plants of Primorye Region allows enlist them as the contract organizations for manufacturing and mounting of metal structures of upper structure of platform. The availability of reserve site in the district of dry dock in the Bay of Cargma allows us to mount enlarged metal structures of integrated deck. The berths of adjoining water territories allow to finish the construction of platform afloat.