Rusneftegaz can announce that we have conceived a new, five-year investment plan following the conclusion of the previous program, although these documents will not be circulated publicly. The latest iteration acts as an immediate successor to its precursor, and will continue to build on the developments made during the previous decade, with a renewed emphasis on replacing the remaining aging and inefficient infrastructure. Whilst the implementation of the previous scheme has been perceived by management to be a comprehensive success, there is disappointment that the growth in our business internationally was not equaled by the gains within the Russian Federation. Therefore, the board of directors has designated a substantial sum to fund the purchase of foreign power generation assets as soon as a viable location becomes available to acquire. Likewise, a comparable total has also been apportioned to ensure that there are sufficient monies to overhaul the plant to contemporary standards. As a consequence, it is projected that total expenditure on properties and plant for the next sixty months will be broadly similar to the amount spent under the last investment plan, which in itself was a significant increase on the previous programs. In response to this disclosure, the Deputy Chief Executive Officer, Aleksandr Filyurin, remarked:
“I am delighted to be able to reveal the next phase of our investment plan today. The plans we have set forth demonstrate not only our ambitions as directors, but also our ambitions as a company. Personally, I think of the investments we have made over the last five years framework from which we can build upon. It is not a finished project, so to speak. Yes, we have spent large amounts of money replacing old equipment; we now have an international trading network, and these are great achievements. But now we need to focus on taking Rusneftegaz to the next level. When we first thought of changing our business plan in 2015, it was not just the case of a five-year plan; it was a plan to transform the company in the long-term. It is not unreasonable to say that we cannot compete with other oil companies in terms of resources, and that is exactly why we have to be intelligent with what we do. We cannot go out there and buy all the oilfields that are owned by much larger oil companies. But if we manage to expand our trading network, we can expand our revenue. If we can buy new power plants, we can expand our profits. When both of these things happen in unison, this plan is the perfect way of growing Rusneftegaz responsibly.”
The rapid expansion of our energy business has become a fundamental tenet to our wider development plan. The board of directors currently perceives Rusneftegaz as an organization in transition, from being solely an operator in the petroleum industry, to one that has multiple interests in affiliated sectors. Such an evolution was first contemplated in 2015, when our company published major revisions to our commercial strategy entailing significant growth domestically, but perhaps more notably, across the globe. These bold schemes should continue to yield strong economic data for Rusneftegaz in the near and distant future. However, despite the fact that it was previously envisaged that the financial statements for 2020 would serve as an indicator for the performance of our investments over the past five years, however, these judgments will be materially affected by the coronavirus pandemic, which will severely impact our results. Since the beginning of March, commodity prices have collapsed, and our corporation is no longer forecasting revenues or profits for the remainder of the twelve-month reporting period. Nonetheless, the health crisis itself is not expected to hinder the implementation of this set of proposals, although if it endures for a prolonged length of time, this spending shall be delayed accordingly. This most notably includes the planned acquisition, and in some instances, installation, of the larger assets embedded within the program. To facilitate these purchases, our management shall review all options available, including from entities located abroad. Whereas previously Rusneftegaz prioritized goods manufactured within the borders of the Russian Federation, primarily due to the risk of further restrictions being imposed, circumstances have now changed. The board of directors now believes that there is no risk of any additional limitations being placed on American and European companies trading with those headquartered in Russia, ensuring that any equipment sold can still be protected by the relevant guarantees, and also maintained under the terms of service contracts between Rusneftegaz and the manufacturer. This ultimately, in concert with the other elements in this scheme, should result in our corporation deploying the best available technologies in the years and decades ahead.