Elaborating on the question raised by the moderator, a famous sportsman and politician Vyacheslav Fetisov, Ms. Sedykh explained how the independent oil and gas company is adapting to the global climate change.

Marina Sedykh acknowledged that the global climate change is ongoing, so the related physical risks will “undoubtedly remain relevant for the INK Group, as well as other businesses.” The company will experience the impact of transitional risks in the localities where it carries out its operations as early as in the mid-term.

Ms. Sedykh announced that the Group had adopted a decarbonization strategy in 2022 including a corporate emissions monitoring, measurement, and management system: “We are now developing a climate strategy in alignment with the TCFD* principles that will be a higher-level document with the decarbonization strategy as one of its components. The climate strategy will address continuity of the Group’s operations and mitigation of related risks.”

The risk factors associated with extreme natural phenomena triggered by climate change of the highest relevance to the company are abnormal heat, thunderstorms, increased amount and intensity of precipitations, the growth of average annual temperature and permafrost degradation (the latter being especially critical to the Republic of Sakha (Yakutia)).

Ms. Sedykh highlighted utilization of associated petroleum gas (APG) by re-injection into formation as one of the Group’s main tasks. INK has been implementing this internationally recognized project in the Yaraktinsky field since 2010: “Oil production, unlike nuclear power for example, is not inherently green. Nevertheless, INK-Capital was the first company in Russia to issue the so-called adaptation bonds 5 billion RUB worth. The funds raised were used to partially refinance the costs incurred in the APG re-injection project.

“The company has started up gas processing facilities that will allow to process more APG and reduce flaring as a consequence. As for the components that cannot be processed for the time being (methane and ethane), we will continue to re-inject them,” said Marina Sedykh.

INK is also considering projects for reducing GHG emissions in drilling and production of hydrocarbons using mobile facilities by upgrading the equipment to run on another type of fuel (LPG or gas-diesel systems instead of diesel counterparts).

The Nevsky International Environmental Congress has been held since 2008 in St-Petersburg and is a platform for boosting interparliamentary cooperation for environmental safety and harmonization of environmental laws of CIS countries. The organizing committee of the congress pays special attention to improvement of nature management and environmental protection legislation using legal regulation to promote resource-saving, energy-efficient and low-waste technologies, advanced processing of raw materials and waste recycling.

*TCFD (Task Force on Climate-related Financial Disclosures) — work group for financial disclosures related to climate change under the international Financial Stability Board established by G20.

Marina Sedykh: The INK Group is consistently reducing GHG emissions