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ANNUAL REPORT 2007 JSC “OGK-6”
THE ANNUAL REPORT OF JSC “OGK-6” FOR 2007
Preliminarily approved
by the Board of Directors of JSC “OGK-6”
on April 14th , 2008 (Protocol #66)
General Director V.M. Sanko
Chief Accountant B.Z. Dolgoarshinnykh
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
ADDRESS p. 04–05
Address of Dmitry Alexandrovich Melnikov, Chairman of the Board
of Directors of JSC “OGK-6”, and Valentin Mikhailovich Sanko, General
Director of JSC “OGK-6”, to shareholders
1 | INFORMATION ON THE COMPANY AND ITS POSITION IN THE INDUSTRY p. 06–23
Brief history of the Company. Priority areas of the Company’s activity
Organizational structure of the Company
Brief information on the Company
Primary events of 2007 that influenced the Company’s development
and achievements
Information on risks and risk management system
2 | PRODUCTION ACTIVITIES p. 24–33
Electric power generation
Heat generation
Specific consumption of fuel equivalent for supply of electric power
and heat
Structure of fuel mix
3 | INVESTMENT ACTIVITIES p. 34–45
Priority objects of technical upgrading and investment program
reconstruction of JSC “OGK-6” for 2007
Major investment projects
4 | ECONOMY p. 46–59
Analysis of consolidated financial indicators
Analysis of financial indicators for JSC “OGK-6” (without consolidation)
5 | SALES OF ELECTRIC POWER AND HEAT p. 60–73
Information on the structure of the market in which the Company
conducts its activities
System of agreements of the Company in the wholesale electricity
and electricity capacity market
Supply of electric power to the wholesale and regional market
Supply of heat
6 | SECURITIES AND SHARE CAPITAL p. 74–83
Company share capital structure
Information on the issue of securities by the Company
JSC “OGK-6” shares trading results
7 | CORPORATE GOVERNANCE STRUCTURE AND PRINCIPLES p. 84–105
Principles and documents
Information on management and controlling bodies
Information on major transactions and interested party transactions
concluded by the Company in 2007
| CONTENTS
02 | 03
p. 106–113 8 | OUR STAFF
Personnel structure
Salaries
Program of retirement benefits
p. 114–119 9 | ENVIRONMENTAL PROTECTION
Environmental management
Atmosphere pollution
p. 120–129 10 | FINANCIAL ACCOUNTING
Audit report
Company financial statements for 2007
p. 130–153 11 | APPENDICES
Appendix 1. Report of the JSC “OGK-6” Audit Committee on the
adequacy of data contained in the Annual Report of JSC “OGK-6” for 2007
Appendix 2. Information on observance by JSC “OGK-6” of the Code of
Corporate Conduct
Appendix 3. Information on major transactions and interested party
transactions concluded by JSC “OGK-6” in 2007
Appendix 4. Characteristics of primary equipment of JSC “OGK-6”
p. 154–155 12 | CONTACT INFORMATION
Company contact information
Contacts for shareholders and investors
Contacts for the media
Auditor
Registrar
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
D. Melnikov, V. Sanko,
Chairman of the Board of Directors General Director
| ADDRESS
04 | 05
DEAR SHAREHOLDERS,
For JSC“OGK-6” the past year has
, the Company to commence direct 41.5%). Likewise, a 4.5% increase in implementation of the investment
become a decisive stage in the implementation of the planned operating capacity was attained in program. Particular attention will
development of the Company. For measures aimed at increasing the 2007 in comparison with 2006. It is be given to quality repairs and
us this was the first full-fledged year installed capacity of Company’s important to note that despite the professional operation of
of operation as an integrated plants. Contracts have been growth of primary performance equipment in order to provide
operating company. Summarizing concluded for practically all indicators, not a single significant reliable and uninterrupted power
the results of the work in 2007, we projects for supply of primary procedural violation was generation.
can speak of the effectiveness of the equipment, and the suppliers committed.
uniform corporate standards and have begun manufacturing it. The By July 1, 2008, JSC “OGK-6” plans
business process optimization implementation of the investment Electricity sales increased by 19% to complete reorganization in the
systems we have adopted. program will result in the installed in 2007 in comparison with 2006, form of incorporation of a
capacity of JSC “OGK-6” reaching reaching 38,989 million kWhr. At company separated from JSC RAO
Approval of the JSC “OGK-6” 10,322 MW by 2011. the same time, sales growth in UES of Russia. As a result, the stock
Development Strategy for 2007- unregulated sectors of the of JSC “OGK-6” belonging to JSC
2011 by the Company’s Board of The development strategy of JSC wholesale market amounted RAO UES of Russia will be
Directors became an important “OGK-6” also stipulates a large- to 58.4%. distributed among shareholders of
event for the Company in 2007. scale program of equipment JSC RAO UES of Russia, leading to
This is one of the fundamental modernization and extension of Last year, the Company achieved increased stock liquidity.
documents that guides the entire its service life. The document sets significant financial results. In
Company staff. The objective of the task of supplying the market accordance with the annual The accomplishment of the set
the strategy is to increase the additionally up to 400 MW of accounts of JSC “OGK-6”, gross tasks will permit the management
capitalization of JSC “OGK-6” by operating capacity (not including Company profits increased by team to resolve the main issue —
prevailing growth of coal-fired new input capacity), selling 100% 50.9% in 2007 in comparison with increasing Company capitalization.
generation and the leading of capacity in the new structure of the previous period, and
position among Russian coal-fired sales markets, as well as increasing amounted to 1,873,621 thousand
generating companies. In order to electric power generation by 35%. rubles. This performance was D. Melnikov,
achieve this goal, it is proposed to By implementing new efficient achieved to a large extent due to a Chairman of the Board
increase the share of coal in the technologies, JSC “OGK-6” also flexible strategy of the Company’s of Directors
fuel mix to 60%. plans to reduce the level of participation in the free sector of
atmosphere emissions. the wholesale market.
In accordance with the Strategy,
the Company proceeded to solve In recent years we can note that Overall, the past year was a
the problem of increasing the the growth rate of electric power successful one for the Company in V. Sanko,
installed capacity to 1270 MW by generation by JSC “OGK- many areas, but we do not intend General Director
2011. This is to take place due to 6”exceeded the growth rate of to rest on our laurels. We can say
the introduction of new power electric power generation in with confidence that in future JSC
generating units and profound Russia as a whole. The share of JSC “OGK-6” will preserve the
modernization of the existing “OGK-6” on the Russian electric progressive trend of development.
ones on the basis of modern high- power market has been increasing The implementation of the flexible
efficiency technologies, including year by year. Electric power strategy of Company’s
gas-steam cycle power generating generation at Company power participation in the free sector of
units and high-performance plants rose by 3.53% in 2007 in the wholesale electric power
power generating units. For comparison with 2006 and market will be continued, which
purposes of financing the amounted to 34.065 billion kWhr. will make it possible to increase
investment program the Company Moreover, the load factor the efficiency of the operating and
placed an additional issue of increased. In the aggregate, it financial activity of JSC “OGK-6”.
shares at the end of 2007. Funds amounted to 42.96% for JSC “OGK- The team will concentrate its
raised by this placement allowed 6” (in 2006, the load factor was efforts on the efficient
Ostankino Tower
OSTANKINO TOWER IS THE HIGHEST STRUCTURE IN RUSSIA WITH A
HEIGHT OF 540 METERS. THE HEIGHT OF KIRISHI GRES POWER PLANT
CHIMNEY IS 320.00 METERS. THIS IS THE HIGHEST POINT IN LENINGRAD
REGION. SEE THIS SECTION FOR THESE AND OTHER INTERESTING DETAILS
ABOUT THE COMPANY.
| ANNUAL REPORT
| 2007
| JSC “OGK-6”
06 | 07
1 INFORMATION ON THE COMPANY
AND ITS POSITION IN THE INDUSTRY
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
1. INFORMATION ON THE
COMPANY AND ITS POSITION
IN THE INDUSTRY
I. BRIEF HISTORY OF THE COMPANY.
PRIORITY AREAS OF THE COMPANY’S ACTIVITY
JSC Sixth Wholesale Power Market Novocherkasskaya GRES, JSC The total electric installed COMPANY STRUCTURE
Generating Company (JSC “OGK- KiGRES, JSC Ryazanskaya GRES, and capacity of JSC “OGK-6” plants
6”) was established by the order of JSC KGRES-2, reserving as its own amounts to 9,052 MW. This
JSC RAO UES of Russia of March 16, property one share of each GRES. renders JSC “OGK-6” the fourth
2005 as part of reforming of the In May of 2006, controlling stocks largest company by installed
electric power industry. On March in JSC GRES-24 and JSC capacity size among all WGCs
RGRES GRES-24
17, 2005, JSC “OGK-6” was Cherepovetskaya GRES were and TGCs created as a result of 45.1
registered with the Inspectorate of deposited in payment for the reform of electric power
the Russian Federal Taxation additional shares of JSC “OGK-6”. industry in Russia. The total
Service for the Leninsky Region of installed heat of JSC “OGK-6” Executive
1.7
NchGRES body ChGRES
the city of Rostov-on-Don. On September 29, 2006, the plants amounts to 2,704 Gcal/hr. JSC “OGK-6”
reorganization of the Company 1.2 35.0
Wholesale generating companies was completed in the form of 4.2
were created on a basis of major incorporation of AO plants, and JSC
power plants belonging to JSC “OGK-6” became a sole operating KiGRES KGRES-2
RAO UES of Russia. Assets included company. On the basis of former
10
in JSC “OGK-6” were selected in JSC Novocherkasskaya GRES, JSC 12.3
accordance with the principles that KiGRES, JSC Ryazanskaya GRES, and
are common for all wholesale JSC KGRES-2, JSC Cherepovetskaya
generating companies. All WGCs GRES, and JSC GRES-24, subsidiaries
have been created on the basis of of JSC “OGK-6” were established.
exterritoriality: they unite plants НчГРЭС
located in various parts of the The primary types of activity of JSC
country, the purpose being to “OGK-6” are electric power and heat
КГРЭС-2
exclude the possibility of a generation and supply/sales of
monopoly of any individual electric power and heatt to
company in a specific region. JSC consumers. In the context of this КиГРЭС
BRANCHES OF OGK-6
“OGK-6” is the second largest activity, JSC “OGK-6” provides for
company in the size of installed operation of power equipment in
РГРЭС
capacity among the created accordance with the current
thermal wholesale generating regulatory requirements, conducts
companies. timely and quality repairs, technical РЭС-24
reequipment and reconstruction of
In payment of the authorized power facilities, organizes energy- ЧГРЭС
capital of JSC “OGK-6”, JSC RAO UES conserving operating regimes for
of Russia, as the sole founder, power plant equipment, and
deposited nearly 100% of the maintains power supply schedules УК
shareholdings of four plants: JSC in accordance with contracts.
| INFORMATION ON THE COMPANY AND ITS POSITION IN THE INDUSTRY
08 | 09
MISSION OF THE COMPANY
“RELIABLE AND EFFICIENT GENERATION AND SUPPLY OF ELECTRIC POWER
AND HEAT WITH A VIEW TO MEET THE NEEDS OF THE POPULATION, ENTERPRISES,
AND ORGANIZATIONS IN THE TERRITORY OF RUSSIA.”
STRATEGIC OBJECTIVE
“TO INCREASE COMPANY CAPITALIZATION BY MEANS
OF PREDOMINANT GROWTH OF COAL GENERATION.”
II. BRIEF INFORMATION ON THE COMPANY
PLANT INSTALLED INSTALLED GEOGRAPHIC PRIMARY/RESERVE
ELECTRIC CAPACITY THERMAL CAPACITY LOCATION FUEL/STARTING FUEL
MW (including water boilers), Gcal/hr
Ryazanskaya GRES 2,650 180 Central UPG Gas, coal / fuel oil / gas, coal
Novocherkasskaya GRES 2,112 75 South UPG Coal / gas / gas, fuel oil
Kirishskaya GRES 2,100 1,234 Northwest UPG Gas / fuel oil / gas, fuel oil
Krasnoyarskaya GRES-2 1,250 1,176 Siberia UPG Coal / none / fuel oil
Cherepovetskaya GRES 630 39 Central UPG Coal / gas / gas, fuel oil
GRES-24 310 – Central UPG Gas / none / none
TOTAL: 9,052 2,704
INSTALLED ELECTRICAL AND THERMAL CAPACITIES OF OGK-6 SUBSIDIARIES
FOR THE END OF 2007 (MWt, Gcal/hr)
2600
2,650 180 2,112 75 2,100 1,234 1,250 1,176 630 39 310
0
RGRES NchGRES KiGRES KGRES-2 ChGRES GRES-24
— Electrical capacity — Thermal capacity
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
RYAZANSKAYA GRES In addition, 500 kW networks also
(RGRES) receive power from
Novovoronezhskaya, Kalininskaya,
The plant is located in and Smolenskaya NPPs and
Novomichurinsk, Ryazan Volzhskaya HPP, as well as flow
Region, 80 kilometers south of from the UPG of mid-Volga region
Ryazan and 285 km southeast and Ural. The 800 MW units of the
of Moscow. Ryazanskaya GRES Ryazanskaya GRES are the most
is one of the five largest Russian efficient condensation sources
power plants by installed among both mobile and
capacity. Installed plant stationary installations, with the
capacity in 2,650 MW. exception of the 1200 MW units of
Kostromskaya GRES. Ryazanskaya
The first order primary fuel is: GRES is one of the primary
approximately 70% — brown coal suppliers on the regional
from Kansko-Achinsky coal basin, balancing market of electric
and approximately 30% brown power.
coal from Podmoskovny coal basin
(grade 2BR). The second order
primary fuel is natural gas
(supplier — JSC Ryazanregiongaz).
Reserve fuel is fuel oil, and starting
fuel — gas and coal.
Chief competitors are TGK-3
(Mosenergo), TGK-4, GRES-4
(Kashirskaya) OGK-1, Kostromskaya
and Cherepetskaya GRES OGK-3,
GRES-5 (Shaturskaya) and
Smolenskaya GRES OGK-4, and
Konakovskaya GRES OGK-5.
NIZHNI NOVGOROD
VLADIMIR
VLADIMIR NIZHNI NOVGOROD
REGION REGION
MOSCOW
SARANSK
MOSCOW MORDOVIA
REGION RYAZAN
RYAZAN GRES
POWER PLANT
PENZA
PENZA
REGION
TULA
TAMBOV
TULA REGION
REGION
LIPETSK
REGION
TAMBOV
LIPETSK
TURBINE TYPE (MODEL)** YEAR OF COMMISSIONING INSTALLED ELECTRIC CAPACITY INSTALLED THERMAL CAPACITY*
MW Gcal/hr
К-300-240 1973 260 15
К-300-240 1973 270 15
К-300-240 1974 260 15
К-300-240 1974 260 15
К-800-240-3 1980 800 30
К-800-240-3 1981 800 30
TOTAL: 2,650 120
* — excluding water boilers; ** — сomplete details on primary equipment of JSC “OGK-6” are presented in Appendix 4.
| INFORMATION ON THE COMPANY AND ITS POSITION IN THE INDUSTRY
10 | 11
NOVOCHERKASSKAYA The plant is located in Northern
GRES (NCHGRES) Caucasus UPG, chief competitors
are Stavropolskaya and
Novocherkasskaya GRES is Nevinnomysskaya gas GRES. Peak
located in Novocherkassk, regulation is conducted by an HPP.
Rostov Region, 53 km southeast The primary load on the power
of Rostov-on-Don. Installed plant is expected in the base
plant capacity is 2112 MW. mode, as well as partial
participation in the balancing
By way of primary fuel types the market. Production by the plant
power plant utilizes ASh-grade constitutes over 15% of
coal from the Rostov coal basin consumption of Northern
(Chikh Almaznaya mine, Caucasus UPG.
Gukovugol Sadinskaya mine,
Sherlovskaya-Naklonnaya mine),
Kuznetsk coal (Kaltansky and
Krasnobrodsky coal strip mines),
and natural gas (supplier — JSC
Rostovregiongaz). Reserve fuel is
gas, and starting fuel — gas and
fuel oil.
VORONEZH
REGION
VOLGOGRAD
VOLGOGRAD
REGION
KALMYKIA
ROSTOV-ON-DON
NOVOCHERKASSK GRES
POWER PLANT
KRASNODAR
TERRITORY
ELISTA
STAVROPOLIE
KRASNODAR
STAVROPOL
TURBINE TYPE (MODEL)* YEAR OF COMMISSIONING INSTALLED ELECTRIC CAPACITY INSTALLED THERMAL CAPACITY
MW Gcal/hr
К-264 (300)-240-1 1965 264 15
К-264 (300)-240-2 1966 264 15
К-264 (300)-240-2 1967 264 15
К-264 (300)-240-2 1968 264 15
К-264 (300)-240-2 1969 264 0
К-310-23,5-3 2005 264 0
К-264 (300)-240-2 1971 264 0
К-264 (300)-240-2 1972 264 15
TOTAL: 2,112 75
* — сomplete details on primary equipment of JSC “OGK-6” are presented in Appendix 4.
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
KIRISHSKAYA GRES The plant is a part of Northwest
(KiGRES) UPG, the generating capacity of
which is also comprised by
Kirishskaya GRES is located in Leningrad NPP, Pskov GRES (OGK-
Kirishi, 150 km southeast of St. 2), HPP and TPP TGK-1, and
Petersburg. Installed plant Northwestern TPP.
capacity is 2,100 MW.
Besides Kirishskaya GRES, only
Fuel oil was the planned fuel type approximately 400 MW of HPP
when the plant was being TGK-1, condensate production of
constructed. Subsequently, CHP 22 (South) and CHP 21
generation units No. 1–6 of the (North), as well as reversible flow
condensation section of the plant from Karelenergo (at 330 kW
and boilers K1T-6T of the heat- voltage) and Central UPG, may be
extraction section were converted attributed to the regulating
to natural gas firing. Currently, sources of the central part of the
natural gas is used as the primary UPG. The combined regulation
fuel for the plant (supplier – JSC capacity of the given sources in
Peterburgregiongaz). Reserve fuel the winter season is less than the
is M-100-grade fuel oil, supplied capacity of Kirishskaya GRES and
by Kirishi refinery (JSC KINEF). does not meet the needs of the
Starting fuel is gas and fuel oil. central part of the UPG regulation,
due to which the plant is the main
frequency and capacity regulator
for the system. The Kirishskaya
GRES units operating at partial
load are the primary source of
power for the balancing market in
the region. The system operator
assigns a fairly high load to the
plant, using it as a regulator and to
ensure system reliability.
KARELIA
PETROZAVODSK
LENINGRAD
REGION
ST. PETERSBURG VOLOGDA
REGION
KIRISHI
GRES VOLOGDA
VELIKY
NOVGOROD YAROSLAVL
REGION
NIZHNI NOVGOROD
REGION YAROSLAVL
PSKOV
TVER TURBINE TYPE (GRADE)** YEAR COMMISSIONED INSTALLED ELECTRICAL CAPACITY INSTALLED THERMAL CAPACITY*
PSKOV
REGION TVER
REGION MW Gcal/hr
К-300-24 0-1 1969 300 0
К-300-24 0-1 1970 300 0
К-300-24 0-1 1970 300 0
К-300-24 0-1 1971 300 0
К-300-24 0-1 1973 300 0
К-300-24 0-1 1975 300 0
PT-50-130/7 1965 50 110
PT-60-130/13 1966 60 139
PT-50-130/7 1967 50 110
PT-60-130/13 1975 60 139
R-40-130/13 1976 40 164
R-40-130/19 1979 40 164
TOTAL: 2,100 826
* — excluding water boilers; ** — complete details on primary equipment of JSC “OGK-6” are presented in Appendix 4.
| INFORMATION ON THE COMPANY AND ITS POSITION IN THE INDUSTRY
12 | 13
KRASNOYARSKAYA In the competitive environment
GRES-2 (KGRES-2) there are HPPs of the Angaro-
Eniseisky Cascade (regulation and
Krasnoyarskaya GRES is located base capacity), efficient thermal
in Zelenogorsk, 167 km east of generation by the Nazarovskaya
Krasnoyarsk. Installed plant GRES (500 MW unit), the
capacity is 1,250 MW. Berezovskaya GRES, and a plant of
the former Kuzbassenergo. At
Primary fuel is brown coal from present, the power plant produces
the Irsha-Borodinsky coal strip combined heat and power, as well
mine of the Kansko-Achinsky coal as being essential from the point
basin, grade 2BR. Reserve fuel is of view of the installed capacity of
not provided for, and the starting Siberian UPG. The plant load
fuel is fuel oil. depends largely on seasonal
factors, such as the presence of
water in reservoirs and air
temperature.
TOMSK REGION
KRASNOYARSK REGION
TOMSK
KRASNOYARSK GRES-2
POWER PLANT
KEMEROVO
REGION
IRKUTSK
KEMEROVO KRASNOYARSK REGION
KHAKASSIA
ABAKAN
IRKUTSK
KYZYL
REPUBLIC OF TUVA
TURBINE TYPE (GRADE)** YEAR COMMISSIONED INSTALLED ELECTRICAL CAPACITY INSTALLED THERMAL CAPACITY*
MW Gcal/hr
К-150-130 1961 150 45
К-150-130 1962 150 45
К-150-130 1963 150 45
PТ-60-90/13 1964 50 145
К-160-130 1974 160 42
К-160-130 1975 160 42
К-160-130 1976 160 42
PТ-135/165-130-15 1981 135 285
PТ-135/165-130-15 1983 135 285
TOTAL: 1,250 976
* — excluding water boilers; ** — complete details on primary equipment of JSC “OGK-6” are presented in Appendix 4.
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
CHEREPOVETSKAYA Competition is expected from the
GRES (ChGRES) Kostromskaya and Konakovskaya
GRES connected with the region
Cherepovetskaya GRES is via 500 kW power lines (flexible
located in Kadui settlement of generation), as well as from
Vologda Region, 50 km west of Kalininskaya NPP (750 kW power
Cherepovets. Installed plant lines, base schedule).
capacity is 630 MW. Simultaneously, due to load of
these power plants towards the
By way of primary fuel types the Moscow Generation Center and
power plant uses NSSh- and high consumption by consumers
DMShS- grade coal, from Khakas connected via 220 kW power lines,
(Stepnoy coal strip mine, no load reduction is planned. The
Chernogorskaya Coal Company, competitive advantage of
Khakassrazrezugol, Vostochno- Cherepovetskaya GRES is the
Beisky), Intinsk (Intaugol), and ability to use both coal and gas for
Kuznetsk (Evtinsky and electric power production.
Zadubrovsky coal strip mines), and
natural gas (supplied by JSC
Vologdaregiongaz). Reserve fuel is
gas, and starting fuel is gas and
fuel oil.
KARELIA ARCHANGELSK
PETROZAVODSK
ARCHANGELSK REGION
LENDINGRAD
REGION
ST. PETERSBURG
CHEREPOVETSK VOLOGDA
GRES REGION
VOLOGDA
VELIKY
NOVGOROD
NOVGOROD KOSTROMA
REGION YAROSLAVL REGION
REGION
KOSTROMA
TVER
TVER YAROSLAVL
REGION
TURBINE TYPE (GRADE)* YEAR COMMISSIONED INSTALLED ELECTRICAL CAPACITY INSTALLED THERMAL CAPACITY
MW Gcal/hr
К-210-130-3 1976 210 13
К-210-130-3 1977 210 13
К-210-130-3 1978 210 13
TOTAL: 630 39
* — complete details on primary equipment of JSC “OGK-6” are presented in Appendix 4.
| INFORMATION ON THE COMPANY AND ITS POSITION IN THE INDUSTRY
14 | 15
GRES-24
Installed plant capacity is 310 MW.
Primary fuel is gas; no types of
reserve fuel are provided for. The
plant is located adjacent to
Ryazanskaya GRES, due to which
the competitive environment of
Ryazanskaya GRES and GRES-24 is
one and the same. In construction
of the power plant, several
building solutions and materials
were employed that are no longer
used anywhere in the power
industry. This has made the
achievement of low specific fuel
expenditure possible. GRES-24 has
the highest capacity factor of all
company power plants.
NIZHNI NOVGOROD
VLADIMIR
VLADIMIR NIZHNI NOVGOROD
REGION REGION
MOSCOW
SARANSK
MOSCOW MORDOVIA
REGION RYAZAN
GRES-24
POWER PLANT
PENZA PENZA
REGION
TULA
REGION TAMBOV
REGION
TULA
LIPETSK
REGION TAMBOV
LIPETSK
TURBINE TYPE (GRADE) YEAR COMMISSIONED INSTALLED ELECTRICAL CAPACITY INSTALLED THERMAL CAPACITY
MW Gcal/hr
К-300-24 0-4 1988 310 0
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
III. MAIN EVENTS OF 2007
DATE EVENT
22.03.2007 FFMS of Russia registers issues and a Prospectus of nonconvertible interest-bearing bonds of JSC “OGK-6” to the bearer of series 01 (state registration number: 4-01-
65106-D) and series 02 (state registration number: 4-02-65106-D), placed via public offering.
10.04.2007 An extraordinary General Shareholders’ Meeting decides to decrease fixed Company assets by decreasing par value of shares.
26.04.2007 The Company places nonconvertible interest-bearing bonds via public offering to the bearers of series 01 (state registration number: 4-01-65106-D). The amount of
the issue was 5 billion rub.
04.05.2007 An extraordinary General Shareholders’ Meeting decides on the early termination of the authority of members of the Board of Directors and election of new members
to the Company’s Board of Directors.
15.05.2007 FFMS of Russia registers the issue of JSC “OGK-6” shares with lower par value and a prospectus of bonds (state registration number 1-02-65106-D) for conversion of the
latter to JSC “OGK-6” shares.
22.05.2007 Placement of shares (state registration number 1-02-65106-D) with lower par value via conversion of the latter to JSC “OGK-6” shares of the same category/type. As a
result, trading of JSC “OGK-6” shares (state registration number 1-01-65106-D) is suspended on Russian exchanges.
24.05.2007 Construction of generation unit №9 is begun at Novocherkasskaya GRES. Vladimir Chub, Rostov Region Governor, Anatoly Chubais, Chairman of RAO UES of Russia,
Alexander Chikunov, managing director of RAO UES of Russia, and Valentin Sanko, OGK-6 CEO participate in a formal cornerstone-laying ceremony.
07.06.2007 FFSM of Russia registers a report of the results of an issue of shares (state registration number 1-02-65106-D) with lower par value placed via conversion of the latter
to JSC “OGK-6” shares of the same category/type.
29.06.2007 The annual General Shareholders’ Meeting decides to pay dividends on the results of 2006 in the amount of 0.00845417 rub. per share and to increase share capital by
placement via public offering of additional ordinary registered uncertified Company shares in the amount of 11,850,000,000 items.
| INFORMATION ON THE COMPANY AND ITS POSITION IN THE INDUSTRY
16 | 17
DATE EVENT
18.07.2007 JSC “OGK-6” second-issue shares (state registration number 1-02-65106-D) are admitted to trade in quoted list “I” of ZAO FB MMVB and in the list of securities
admitted to trade without undergoing listing procedures of JSC RTS.
14.09.2007 JSC “OGK-6” subsidiary Kirishkaya GRES commences implementation of the “Reconstruction of unit №6 on a gas-vapor technology basis” project (construction of PGU-800).
18.09.2007 FFMS of Russia registers a decision for the release and prospectus of an additional share issue (state registration number 1-02-65106-D-001D), distributed via public
offering.
27.09.2007 An extraordinary General Shareholders’ Meeting decides to pay/declare dividends on the results of the first half of 2007 in the amount of 0.00978311 rub. per ordinary
share.
25.09.2007 JSC “OGK-6” CEO Valentin Sanko and Vologda Region Governor Vyacheslav Pozgalev sign an agreement of cooperation between JSC “OGK-6” and the Vologda Region
administration. The agreement is intended to improve the quality of life of the regional population, create conditions for its steady socioeconomic development,
develop the fuel and energy complex, and attract investments to the regional economy.
30.10.2007 An extraordinary General Shareholders’ Meeting decides to approve a major transaction (interrelated transactions related to offering ordinary Company shares to
investors, including using a stabilization mechanism.
09.11.2007 An extraordinary General Shareholders’ Meeting decides to reorganize JSC “OGK-6” by incorporating therein JSC “OGK-6” Holding, created through reorganization of
UES of Russia, to increase share capital of the Company, and to amend the Articles of Association with regard to increasing Company share capital.
19.12.2007 The Board of Directors defines the price of placing additionally issued shares (state registration number 1-02-65106-D-001D), which amounted to 3.8 rub. per share.
29.12.2007 JSC “OGK-6” places by public offering an additional issue of ordinary registered uncertified Company shares (1-02-65106-D-001D) in the amount of 5,531,497,444
items. ZAO Gazenergoprom-Invest (affiliated company of JSC Gazprom) acquires 17.13% of the increased share capital.
ANNUAL REPORT 2007 JSC “OGK-6”
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IV. INFORMATION ON RISKS
AND RISK MANAGEMENT
Risk management is considered one of the most important elements of The primary objectives of the given measures are:
strategic management and internal control, ensuring increased quality of » ensuring optimal protection and stability of the Company in the face of
corporate management. the external and internal risks accompanying the realization of major
investment projects by achieving an optimal balance of risk
The Company plans to create an integrated risk management system (of management expenditures and acceptable damages;
both financial and non-financial risks), which will be brought to the attention » minimization of the Company’s financial resources directed towards
of all employees. Within the context of this system, development of an eliminating the results of risks occuring in the process of realizing major
approach to risk management inherent in all of the Company’s lines of investment projects;
business is planned, which would ensure effective sharing of information » increasing the Company’s investment attractiveness and providing
essential for efficient and strategic risk management among the Board of reliable guarantees to investors through optimization of risk situations in
Directors, administrative bodies, and all functional subdivisions. the process of realization of major investment projects.
The creation of a comprehensive risk management system (CRMS) for all In the context of the given business focus on risk management for major
Company business processes is being conducted on a step-by-step basis. investment projects, the following results were achieved in 2007:
» a set of measures intended to minimize risks related to realization of
1. The beginning (base) stage of construction of the CRMS was marked by major investment projects was developed. The Provision “Concerning
creation of a corporate mechanism of risk management via outsourcing the order for organizing measures for risk monitoring and management
(transmission of specific risks to insurance companies for a specific fee). in the context of realization of investment projects of JSC “OGK-6”,
This made it possible to ensure optimal protection and stability of the approved by the JSC “OGK-6” Board of Directors (protocol №55 dated
Company in the face of the external and internal risks accompanying the 12.04.2007), constitutes the document regulating the order of
Company’s primary activity. Company insurance protection throughout cooperation between the Company’s functional departments in the
2007 was provided in accordance with the “JSC “OGK-6” Insurance Protection process of carrying out measures to minimize risks related to realization
Program”, approved by the JSC “OGK-6” Board of Directors (protocol № 29 of major investment projects;
dated 12.25.2006) for the following lines: » a list of primary risk groups related to realization of major investment
» voluntary medical insurance projects has been developed;
» accident and illness insurance » practical recommendations for subdivisions for risk analysis in the
» Company property insurance; process of realization of major investment projects have been
» voluntary vehicle insurance; developed.
» state liability insurance for companies operating dangerous production
facilities; 4. In the context of the Company’s nonfinancial (reputational, strategic,
» civil liability insurance for owners of hydrotechnical installations; political) risks, an annual Company report process has been launched in the
» obligatory vehicle liability insurance; field of social liability and corporate stability:
» liability insurance for Company directors and officials. » managers of the Company’s structural subdivisions have been polled;
» the stakeholder environment has been mapped out;
2. In the context of social risk management, a Nongovernmental Company » a “Report on social liability and corporate stability of JSC “OGK-6” for 2006”
Staff Pension Program was implemented in the Company in 2007 and approved has been prepared and verified (through public hearings) in accordance
by the JSC “OGK-6” Board of Directors (protocol №38 dated 04.25.2007). The with international standards;
nongovernmental pension system makes it possible to increase the level of » a series of normative and guidance documents regulating the order for
social protection and motivation of JSC “OGK-6” workers, as well as improve the organizing and holding public hearings has been developed.
mechanism for attracting and retaining highly qualified personnel.
Subsequently, JSC “OGK-6” plans to continue preparing regular reports in the
3. In developing the formulation of the comprehensive risk management area of social liability and corporate stability, introducing better models of
system, it was decided to develop a system that would provide a single international practice in the area of social liability and corporate stability, and
comprehensive approach to Company risk management in the process of improving the reporting structure and making it more meaningful and
implementing major investment projects. constructive for the Company’s stakeholder environment.
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18 | 19
At present, the Company believes the following risks to be important Prices formed on the free electric power market may prove insufficient
for it: to cover the Company’s production expenses.
RISKS RELATED TO COMPANY ACTIVITIES AND INDUSTRY RISKS Current normative documents provide for the gradual liberalization of the
wholesale electric power market and the semiannual reduction of volumes
Reform of the Russian wholesale electrical power market is associated with a of electric power produced, realized at the regulated rates. In the event of
series of risks that may have a significant unfavorable impact on the continuing liberalization of the electric power market, the price level on the
Company’s earnings and activities and the results thereof. free electric power market will have a direct impact on the Company’s
earnings and profitability. The future level of electric power prices is difficult
Since the official beginning of reforms in July of 2001, the timelines for to predict, and there is no guarantee that further liberalization of the market
completing the reform stages and the context of these stages have changed will lead to an increase in the specified price level and ensure sufficient
several times, and there is no guarantee that the existing plan of the Russian coverage of the Company’s production costs. It is likewise difficult to predict
government for the complete liberalization of the electrical power market by whether or not the Company will be able to compete successfully on the
2011 will be realized. Moreover, there are no reliable indications of when the free electric power market.
reforms will be completed, or whether or not they will be completed at all.
Demand for electric power and heat in Russia may not grow as rapidly
Liberalization of prices for electricity and electrical output on the as was assumed in the forecasts on which the Company currently
electrical power market may be suspended or reversed. relies. This may result in a lower utilization factor of the Company’s
existing and recently commissioned capacities.
One of the primary objectives of reforming the Russian electrical power
market is the gradual liberalization of prices for electric power. The The Company’s investment program as a while is compiled on the basis of
Government of the Russian Federation has stated that liberalization of prices specific forecasts of the growth of electric power and heat consumption in
for electric power will be completed by 2011. The principles of gradual Russia, including forecasts of JSC RAO UES of Russia and Minpromenergo. If
liberalization of the market were originally established in Order №529 of the the actual increase in electric power and heat consumption proves lower
RF Government, “Concerning improvement of the order of functioning of than predicted, electric power surpluses may form on the Russian market. If
the wholesale electric power/output market”, dated August 31, 2006, which this occurs, it is entirely possible that the less effective generation units with
introduced new rules for the functioning of the wholesale electric power the greatest service life will have to be operated with a lesser load.
market, and which were further refined in Order №205 of the Government of
the Russian Federation dated April 07, 2007. The Company’s activities depend largely on JSC Gazprom, its primary
gas supplier, and the Company will face a significant price increase for
If liberalization of prices is not implemented in the form presently provided the gas it purchases.
for, this may have a significant unfavorable influence on the Company’s
financial situation and activities and results thereof. Natural gas is the primary form of fuel for Company subsidiaries Kirishkaya
GRES and GRES-24, as well as for two (1,600 MW installed capacity)
Under rate regulation of the thermoelectric power industry, the generation units at Ryazanskaya GRES. In 2007, gas comprised 55.16% of the
change in rates could be such that their amount would prove Company’s fuel balance.
insufficient to cover the Company’s production costs.
The gas supply market in Russia is significantly monopolized, since the
Sales of electric power and heat in Russia continue to remain a subject of overwhelming majority of gas supplies, reserves, production, and
state regulation. The company assumes that at present and over the next transportation is controlled by JSC Gazprom.
few years, it will be obliged to sell a large part of the electric power it plans to
generate in the context of regulated contracts at established rates. Rates are Gazprom supplies gas to the Company in the context of pre-agreed “limit”
reviewed annually either by the Federal Tariff Service (FTS), in the case of quotas established for JSC RAO UES of Russia and its subsidiaries, including
electric power rates, or by the regional tariff committee in the case of heat the Company, at the regulated prices/rates established by the FTS.
rates, on the basis of the estimated production costs of the producing Under gas supply contracts of independent producers at market prices, and
company for the following year. Most of the heat plants in Russia use gas as starting in the 2nd half of 2007, if there was a shortage of “limit” quota
the primary fuel, and since gas purchases are the primary component of volumes, additional volumes of gas were delivered under limited gas
operational costs of such power plants, rates in Russia are at a low level due contracts at prices in accordance with Order No. 333 of the RF government
to regulation of domestic gas prices, which at present are significantly lower dated May 28, 2007.
than export prices. The FTS does not always approve a rate increase in
accordance with an increase in the Company’s expenses, and as a result, the In addition, the rates established by the FTS for gas supplied by JSC Gazprom
amount of some rates is insufficient to cover all costs of electric power in Russia for pre-agreed “limit” quotas are likewise expected to be liberalized
generation. In practice, decisions regarding rates are significantly influenced to ensure the same level of profitability for JSC Gazprom from gas sales on
by social and political factors, which leads to significant delays in their the domestic market as for export gas sales by 2011. In accordance with the
establishment and to rates being increased by an amount lower than that schedule for liberalization of gas prices, a price increase of 15% is expected in
necessary to compensate for the Company’s increasing expenses. January 2007, 25% in January 2008, 13% in January and July 2009 and 2010,
ANNUAL REPORT 2007 JSC “OGK-6”
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after which in January 2011, the price of gas should finally reach the level of New Wholesale Market Rules. Consumers under such Regulated contracts
export gas prices (minus customs and export duties). There is no guarantee are distributed among specific producers by the Trade System Administrator
that liberalization of the electric power market provided for by Order №205 based on a range of factors, including the forecast of electric power
of the RF government will occur concurrently with liberalization of gas production and consumption established by the FTS. If the consumer is
prices, which may have a significant unfavorable impact on the Company’s unable to pay for the supplied electric power or delays payment, the
earnings and activities and results thereof. Company may find itself unable to unilaterally dissolve the Regulated
contract or suspend electric power supply for political, legal, or social
Due to restructuring of JSC RAO UES of Russia, JSC Gazprom and its reasons. Delays in payment and nonpayment of electric power and heat
affiliated companies may become the the Company’s principal supply may have a significant unfavorable impact on the Company’s
shareholder. The interests of JSC Gazprom, which is likewise a financial situation and the results of its activities.
shareholder of competitive generating companies, may conflict with
the interests of holders of Ordinary shares and the GDR. The Company may find itself unable to fulfill its obligations under the
Regulated contracts.
At present, it is expected that in June–July of 2008, JSC RAO UES of Russia
will cease to exist as a holding company, and its stake in its subsidiaries, The quantity of electric power that the Company must supply under its
including the Company, will be distributed among the existing shareholders Regulated contracts is calculated based on its anticipated annual earnings. If
of JSC RAO UES of Russia. In the context of reorganization, JSC RAO UES of for any reason (with the exception of acts of God) the Company is unable to
Russia agreed to exchange the shares that affiliated companies JSC generate the amount of electric power required under Regulated contract, it
Gazprom, JSC Norilsk Nickel, JSC SUEK, and the Russian Federation, as major will be obliged to purchase an additional quantity of electric power at the
current shareholders of JSC RAO UES of Russia will receive upon the free “day-ahead” market price or on the balanced market. If the costs of the
liquidation of JSC RAO UES of Russia. This plan likewise provides, upon purchase prove higher than the electric power generation cost for the
liquidation of JSC RAO UES of Russia, for receipt by affiliated companies of Company or if it is unable to purchase the necessary volumes of electric
JSC Gazprom of a block of more than 60% of the Companys’ shares. As a power on the wholesale market, this may have a significant unfavorable
result, JSC Gazprom will obtain considerable ability to influence the impact on the Company’s financial situation and activities and results
Company’s activities, and its interests as a Company shareholder may thereof.
conflict with its interests as a supplier of gas to five Company subsidiaries.
Under such circumstances, the ability of the Company to realize its The Company may encounter stiff competition from other WGCs, TGCs,
commercial strategy and objectives may be limited, which as a result may and other electric power producers permitted on the wholesale market.
have a significant unfavorable impact on the Company’s financial situation
and results of its activities. One objective of electric power reform in Russia is the creation of
competition in the electric power generation and supply sector. The
Several Company power plants depend on coal suppliers, and the Company competes with other OGCs, TGCs, and other electric power
Company may encounter a price increase on coal purchased by the producers permitted on the wholesale market, including the more
Company. economically efficient JSC HydroOGK and the Federal State Unitary
Enterprise Russian State Concern for Electric Power and Heat Generation at
Krasnoyarskaya GRES-2, Novocherkasskaya GRES, and Cherepovetskaya Atomic Plants (Rosenergoatom). Intensification of competition is anticipated
GRES, as well as four generation units at Ryazanskaya GRES (installed capacity with the subsequent liberalization of the wholesale power market. If the
1,050 MW), use coal as the primary fuel. Company finds itself unable to effectively cope with the growing level of
competition in future, this may have a significant unfavorable impact on the
There is no guarantee that coal prices will not increase significantly due to Company’s financial situation and activities and results thereof.
increased demand for coal as a result of liberalization of gas prices. In the
end, the Company may incur additional expenses related to purchasing coal The Company’s facilities and equipment are becoming physically
at a higher price or purchasing other types of fuel. obsolete, resulting in increased probability of mechanical accidents
and emergencies, and it may become necessary to modernize them.
Any interruptions, suspension, or cessation of coal supply to Company
power plants operating on coal, and an increase in coal prices as a whole, Many of the Company’s active generation units were commissioned in the
may have a significant unfavorable impact on the Company’s financial 1960s and 1970s and require maintenance to extend their service life. The
situation and activities and results therof. given generating capacities are particularly prone to mechanical accidents
and unforeseen situations, which may lead to a disruption of the Company’s
Consumers may delay or fail to make payments to the Company for activities, as well as additional expenses for planned and unplanned repairs
electric power and heat supplied. of generating equipment. If the Company is unable to modernize its plants,
it may find itself unable to maintain its productivity, which may have a
The Company sells or can sell a large part of the electric power on the significant unfavorable impact on the Company’s financial situation and
wholesale market according to regulated contracts in accordance with the activities and results thereof.
| INFORMATION ON THE COMPANY AND ITS POSITION IN THE INDUSTRY
20 | 21
The Company may find itself unable to obtain the necessary additional Developing markets such as Russia are subject to greater risks than
funds. more developed markets, including significant legal, economic, and
political risks.
The Company will require additional capital investments to update and
modernize existing capacities, as well as for construction of new ones. The Investors in developing markets such as Russia should take into account the
Company’s current investment program provides for allocation of fact that these are subject to greater risks than more developed markets,
approximately 57,191 million rubles for construction of new generation units including in some instances significant legal, economic, and political risks.
in 2008–2011. Additionally, financial disturbances in one country with a developing market
have a tendency to unfavorably impact the stock market quotations of all
If there is no access to capital in the future, the Company may decide to countries with a developing market, since investors transfer their funds to
reject construction of new plants. Although this decision will not affect the more stable, developed markets.
results of the Company’s activities from operating capacities either current or
under construction, such a decision will impact growth in the future and will In the Russian Federation, administrative and economic reforms are currently
have a significant unfavorable impact on the Company’s financial situation being carried out with a view to improving the national economic situation,
and activities and results thereof. which in turn will lead to improvement of the social environment and
political stability.
The Company may find itself unable to commission new generating
capacities provided for by its investment program, or it may not No negative changes in the situation in Russia that could negatively
receive the expected return from funds invested in the creation of new influence the economic situation and activity of the Company are foreseen
generating capacities. in the near future. However, the possibility of destabilization of the national
economic situation due to a crisis in the world financial markets or a sharp
By the end of 2011, the Company plans to commission four new generation drop in oil prices should not be ruled out.
units with an aggregate electrical capacity of 1,270 MW. In view of the
relatively limited number of companies able to carry out this type of FINANCIAL RISKS
construction, there is no guarantee that the Company will be able to employ
contractors for the given projects in the planned time periods and within the Risk of change in the currency exchange rate
planned budget. Thus, the Company may find itself unable to carry out its The Company’s financial condition, its liquidity, sources of financing, and
investment program on time or within budget, or to complete it at all. performance, do not depend significantly on fluctuations in the currency
Delays in realizing the Company’s investment program, errors in analyzing exchange rate, since the Company plans its activities such that its assets and
the expediency and costs of the investment program, increased expenses liabilities are expressed in the national currency. At the same time, certain
related to the investment program, and errors at the construction stage may transactions related to obtaining equipment may be expressed in foreign
have a significant unfavorable impact on the Company’s financial situation currency. In the event of the negative influence of a change in the currency
and activities and results thereof. exchange rate, the Company plans to conduct a risk analysis and make
corresponding decisions in each specific case.
The Company’s activities, earnings, and expenses may be affected by factors
beyond the Company’s control, such as accidents and natural disasters. Risk of change in interest rates
The Company’s activities depend on the operation of its generating The electric power industry belongs to the capital-intensive fields of
capacities, at which accidents may occur, including through the fault of industrial production. Strengthening of the Company’s market position will
service personnel, and emergency situations may arise. They may happen to require significant additional investment expenditures. In the context of the
be in a natural disaster zone, i.e., under the influence of factors beyond the planned financial and economic policy, the Company plans to raise
Company’s control. Accidents and emergencies may lead to breaks in the borrowed funds and liquidate its obligations in a timely fashion. In this
Company’s activities and, as a result, significant losses for the Company. regard the Company is subject to the risk of a change in interest rates on
Additionally, the Company may incur significant expenses for restoring interest-bearing debts. An increase in market interest rates may result in the
generating capacities damaged by accident, emergency situation, or natural Company being obliged to obtain more expensive funds to finance its
disaster, which in turn may have a significant unfavorable impact on the investment program and current activities. Additionally, as interest rates rise,
Company’s earnings and activities and results thereof. interest payments on loans from commercial banks increase and,
correspondingly, the Company’s net profit decreases.
COUNTRY AND REGIONAL RISKS In order to prevent the negative influence of changes in interest rates, the
Company proposes to obtain long-term credits and loans to avoid the
Country risks of the Company include political, economical, and social risks negative influence of short-term interest rate fluctuations, and to lower the
intrinsic to the Russian Federation. These risks are beyond the Company’s control. share of credits and loans in the total amount of liabilities.
ANNUAL REPORT 2007 JSC “OGK-6”
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Risk of inflation 2. Plaintiff/appellant: JSC “OGK-6”
Inflation may have a significant unfavorable influence on the Company’s
productivity. The Company’s production is concentrated in Russia, and the Defendant: FTS RF Interdistrict Inspectorate for major taxpayers of Rostov
majority of direct expenses occur in Russia and in rubles. Since the Region
beginning of 1990, a high rate of inflation has been observed in Russia. Subject of dispute: Invalidation of the 01.23.2007 decision of the IIFTS with
Inflation increased sharply after the 1998 financial crisis, reaching a level of regard to additional taxation of income for 2006 in the amount of 76,858,375 rub.
84.4% that year (according to measurements of the consumer price index).
Despite the recent reduction of inflation rates, which were 11.7% in 2004, The risk of a verdict unfavorable for the issuer is average
10.9% in 2005, 9.0% in 2006, and 11.9% in 2007, an increase in expenses
caused by inflation may be observed in Russian companies as a whole, 3. Plaintiff/appellant: JSC “OGK-6”
which is related to the general level of prices in Russia, such as expenses for
feedstock and materials, as well as for labor costs. If these trends continue Defendant: FTS RF Interdistrict Inspectorate for major taxpayers of Rostov
and electric power rates remain regulated, the Company may find itself Region
unable to preserve or maintain the profit norm from its primary form of
activity at the optimal level. Subject of dispute: Invalidation of the 12.11.2006 decision № 07/44 of the
IIFTS with regard to additional taxation of income for 2004-2005 in the
Legislative risks amount of 113,209,959 rub.
Due to possible changes in current tax legislation, such as amendments to
legislative tax and fee acts related to increased tax rates and introduction of The risk of a verdict unfavorable for the issuer is average
new taxes, there is a probability that the Company’s expenses for payment of
taxes and obligatory payments will increase. These changes will certainly 4. Plaintiff/appellant: JSC “OGK-6”
influence the profit level.
Defendant: FTS Interdistrict Inspectorate of Russia № 7 for Ryazan Region
To reduce the possible influence of this risk, the Company proposes to carry
out tax and financial planning. In the event of amendments to the current Subject of dispute: Unlawfulness of the inaction of the IIFTS, expressed in
order and conditions of taxation, the Company intends to plan its financial non-return of income taxes for 2003-2006 in the amount of 134,081,697 rub.
and economic activity with these changes taken into account. and of VAT for 2006 in the amount of 20,116,937 rub.
A change in the tax legislation with regard to regulation of securities may The risk of a verdict unfavorable for the issuer is average
likewise have a significant influence on the Company’s activities.
5. Plaintiff/appellant: JSC “OGK-6”
JUDICIAL RISKS
As of 12.31.2007, the Company had one claim laid against it exceeding 10 Defendant: FTS Interdistrict Inspectorate of Russia № 7 for Ryazan Region
million rubles, amounting to 36,016,734 rubles. The claim was laid in
accordance with allegation № 7 of the FTS of Russia Interdistrict Inspectorate Subject of dispute: Unlawfulness of the inaction of the IIFTS, expressed in
for Ryazan Region against JSC “OGK-6” for collection of tax sanctions. The risk non-return of 101,076,500 rub. from the budget.
of a verdict unfavorable for the issuer is average
The risk of a verdict unfavorable for the issuer is average.
Additionally, the Company is currently involved as a plaintiff/appellant in the
following legal proceedings: 6. Plaintiff/appellant: JSC “OGK-6”
1. Plaintiff/appellant: JSC “OGK-6” Defendant: FTS RF Interdistrict Inspectorate for major taxpayers of Rostov
Region
Defendant: FTS RF Interdistrict Inspectorate for major taxpayers of Rostov
Region Subject of dispute: Invalidation of the 11.12.2006 decision of the IIFTS with
regard to additional taxation of income in the amount of 27,626,780 rub.,
Subject of dispute: Unlawfulness of the inaction of the IIFTS, expressed in additional taxation of income from foreign legal entities in the amount of
non-return of income taxes for 2003 in the amount of 145,344,450 rub. and 969,486 rub., additional VAT taxation of 9,789,176 rub., requirement of
of VAT for 2006 in the amount of 26,604,952 rub. additional payment for use of water bodies in the amount of 881,706 rub., a
water tax in the amount of 857,610 rub., additional taxation of income of
The risk of a verdict unfavorable for the issuer is average private individuals in the amount of 954,749 rub., charging JSC “OGK-6” with
tax liability in the amount of 9,369,957 rub., and imposition of fines on the
amounts of the additional and contested taxes
The risk of a verdict unfavorable for the issuer is average.
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22 | 23
7. Plaintiff/appellant: JSC “OGK-6” 10. Plaintiff/appellant: JSC “OGK-6”
Defendant: JSC Sibvolokno Defendant: Kirishky District IFTS, Leningrad Region
Subject of dispute: Ruling of insolvency/bankruptcy. Amount of claims: Subject of dispute: Invalidation of the decision of IFTS to hold JSC “OGK-6”
481,330,322 rub. liable for a tax offence committed 02.14.2007 №02-09/590, in the amount of
114,178,037 rub.
The risk of a verdict unfavorable for the issuer is low
The risk of a verdict unfavorable for the issuer is low
8. Plaintiff/appellant: JSC “OGK-6”
11. Plaintiff/appellant: JSC “OGK-6”
Defendant: Donskoi Moscow Criminal Intelligence
Defendant: FTS Interregional Inspectorate of Russia № 7 for Ryazan Region
Subject of dispute: Ruling of insolvency/bankruptcy. Amount of claims: Subject of dispute: Invalidation of the 02.15.2006 №12-43/9dsp decision to
65,572,848 rub. collect income tax in the amount of 231,480,156 rub., penalties of 26,674,212
rub., and penal sanctions in the amount of 36,016,485 rub.
The risk of a verdict unfavorable for the issuer is low
The risk of a verdict unfavorable for the issuer is low
9. Plaintiff/appellant: JSC “OGK-6”
There may be other risks in the Company’s activities of which the Company
Defendant: Kirishky District IFTS, Leningrad Region is not aware or which are not currently significant for it, but which may
potentially have a negative influence on the Company’s economic activities.
Subject of dispute: Invalidation of acts of the tax agency concerning
renunciation of holding JSC “OGK-6” liable for tax offences dated 14.12.2006
№ 13-158, № 13-159, № 13-160, № 13-161, № 13-162, № 13-163, № 13-164,
№ 13-165, № 13-166, № 13-167, and 18.01.2007 № 13-06, charging income
tax for 2003, 2004, 2005, and the first half-year of 2006 in the amount of
138,480,433 rub., reduced VAT for January, February, March, April, May, and
August of 2006 in the amount of 25,556,581 rub., and reduced income tax
losses for the first 9 months of 2006 in the amount of 120,996,385 rub.
The risk of a verdict unfavorable for the issuer is low
Power
AGGREGATE LAUNCHING CAPACITY OF CARRIER ROCKET ENERGIA
IS 2,000 MW. THIS FIGURE IS COMPARABLE TO THE INSTALLED CAPACITY OF
NOVOCHERKASSK GRES POWER PLANT OF 2112 MW.
| ANNUAL REPORT
| 2007
| JSC “OGK-6”
24 | 25
2 PRODUCTION
ACTIVITIES
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
2. PRODUCTION
I. ELECTRIC POWER generation in 2007. The greatest According to the scenario of SHARE OF OGK-6 IN RUSSIAN ELECTRIC
GENERATION increase in electric power development of the electric POWER GENERATION FOR 2007
generation in 2007 was noted for power industry and the JSC RAO
In recent years, the growth rate of Krasnoyarskaya GRES-2 (915.5 UES of Russia holding, in 2007– 3.35%
electric power generate by JSC kWh, 24.24%), due to increased 2011 the average yearly increase
“OGK-6” has exceeded the growth plant load by order of the system in electric power consumption in
rate for electric power generation operator owing to a water Russia will be 4.9% in the baseline
in Russia. The share of JSC “OGK-6” shortage for the HPP in the case. The low load of OGK-6
on the Russian electric power region of the plant. The increase plants in comparison with other
market is increasing year by year. in electric power generation in WGCs make it possible to expect
In 2005 and 2006 it was 2.94% 2007 in comparison with 2006 that growth rates of electric
and 3.30%, respectively. The share was: 5.62% for Ryazanskaya GRES, power generation for OGK-6 will
of “OGK-6” on the Russian electric 4.78% for Cherepovetskaya GRES, overtake growth rates of electric
power market in 2007 was 3.35%. 4.40% for GRES-24, and 2.89% for power generation for Russia as a
Novocherkasskaya GRES. whole in the near future.
Electric power generation by
OGK-6 plants was 34,065 billion The 9.32% reduction in electric
kWh in 2007, which is 1,161 power generation for Kirishkaya
billion kWh (3.53%) more than GRES in comparison with 2006
in 2006. was due to a reduction in
economically inefficient electric
All OGK-6 power plants, with the power generation using fuel oil, — OGK-6
exception of Kirishkaya GRES, saw which took place under the cold
an increase in electric power winter conditions of 2005–2006.
— Russia as a whole
ELECTRIC POWER GENERATION 2005 2006 2007
million kWh
OGK-6 28,006 32,904 34,065
Russia as a whole 953,000 996,078 1,016,000
Share of OGK-6 in Russian electric power generation 2.94% 3.30% 3.35%
| PRODUCTION ACTIVITIES
26 | 27
SHARE OF OGK-6 IN ELECTRIC POWER 3.4
GENERATION FOR RUSSIA AS A WHOLE, %
2.94 3.30 3.35
2.0
2005 2006 2007
DYNAMICS OF ELECTRIC POWER GENERATION
IN 2005–2007, MILLION KWH
9500
0
RGRES NchGRES KiGRES KGRES-2 ChGRES GRES-24
— 2005 — 2006 — 2007
ELECTRIC POWER GENERATION 2005 2006 2007
million kWh million kWh million kWh
TOTAL FOR OGK-6 28,006.4 32,904.4 34,065.0
Ryazanskaya GRES 6,537.1 7,695.9 8,128.2
Novocherkasskaya GRES 7,691.8 9,116.4 9,380.3
Kirishkaya GRES 6,028.0 7,327.8 6,644.8
Krasnoyarskaya GRES-2 3,604.8 3,776.0 4,691.5
Cherepovetskaya GRES 2,642.2 3,241.4 3,396.4
GRES-24 1,502.5 1,746.9 1,823.7
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
CAPACITY FACTOR For reference: the capacity factor VЭ In 2007, the capacity factor for
(CF) is equal to the ratio of actual CF = . 100% OGK-6 as a whole was 42.96%,
N ust . t
electric power generation for a which is 1.46% more than in 2006.
given period to the possible where:
electric power generation for the VЭ is the volume of electric power
same period under conditions of generated for the period, in kWh;
operating at full capacity without
shutdowns. The CF indicates the Nust is installed capacity, in kW;
level of capacity utilization for
electric power generation. t is the number of calendar hours
in a period, in hours.
CF DYNAMICS FOR 2005–2007, %
2005 2006 2007
% % %
TOTAL FOR OGK-6 35.32 41.50 42.96
Ryazanskaya GRES 28.16 33.15 35.01
Novocherkasskaya GRES 41.57 49.28 50.70
Kirishkaya GRES 32.77 39.83 36.12
Krasnoyarskaya GRES-2 32.92 34.48 42.84
Cherepovetskaya GRES 47.88 58.73 61.54
GRES-24 55.33 64.33 67.16
CF DYNAMICS
FOR 2005–2007, %
70
0
RGRES NchGRES KiGRES KGRES-2 ChGRES GRES-24
— 2005 — 2006 — 2007
| PRODUCTION ACTIVITIES
28 | 29
AVERAGE OPERATING FACILITY 2005 2006 2007
CAPACITY OF JSC “OGK-6” MW MW MW
PLANTS
This table presents the average RGRES 2,218.2 2,100.8 2,280.4
plant operating capacity for 2005– NchGRES 1,528.4 1,772.4 1,673.9
2007 (in MW). KiGRES 1,564.7 1,524.6 1,709.0
The term “operating capacity” KGRES-2 969.6 931.6 1,020.1
refers to installed power plant ChGRES 443.9 472.9 437.0
capacity, less limitations on its GRES-24 292.8 285.1 286.7
capacity and the capacity of
equipment withdrawn for repairs. OGK-6 7,017.6 7,087.4 7,407.1
II. HEAT GENERATION Overall heat generation for “OGK- A significant share in the heat The remaining power plants
6” in 2007 was 4.32 million Gcal, generation of OGK-6 is accounted produce an insignificant amount
which is 191.2 thousand Gcal or for by Kirishkaya GRES (61.6%) and of heat, necessary only for the
4.2% lower than in 2006. Krasnoyarskaya GRES-2 (27.3%). private needs of the GRESs and
the nearby settlements.
DYNAMICS OF HEAT GENERATION
2800
BY OGK-6 PLANTS IN 2005–2007,
IN THOUSAND GCAL
261 251 271 117 118 96 2,691 2,734 2,664 1,342 1,285 1,178 128 125 114
0
RGRES NchGRES KiGRES KGRES-2 ChGRES
— 2005 — 2006 — 2007
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
2005 2006 2007 DYNAMICS OF HEAT GENERATION
thousand Gcal thousand Gcal thousand Gcal BY OGK-6 PLANTS IN 2005–2007,
IN THOUSAND GCAL
TOTAL FOR OGK-6 4,538.4 4,513.1 4,321.9
Ryazanskaya GRES 260.5 250.8 270.8
Novocherkasskaya GRES 117.3 117.6 95.7
Kirishkaya GRES 2,690.7 2,734.5 2,663.6
Krasnoyarskaya GRES-2 1,341.9 1,285.2 1 177.8
Cherepovetskaya GRES 127.9 125.1 114.1
3. SPECIFIC OIL Q P is the heating value, as per
H
Overall, for OGK-6 the specific oil
EQUIVALENT chemical laboratory data, of solid equivalent consumption for
CONSUMPTION and liquid or gaseous fuel, in kcal/ supplying electric power in 2007
(SRFC) FOR SUPPLY kg (MJ/kg) and kcal/m3 (MJ/m3), decreased by 1.9 g/kWh in
OF ELECTRIC POWER respectively; comparison with 2006, and by 2.1
AND HEAT QP g/kWh in 2005, primarily due to
H
Э= increased electric power
7000
For reference: The use of various production.
fuel types (solid, liquid, and Э is the caloric equivalent.
gaseous) makes a generalized The specific fuel consumption for
quantitative calculation of their Average caloric values are 7900 heat supply in 2005–2007
consumption for power
kcal/m3 for gas and 9800 kcal/kg decreased by 1.8 kg/Gcal in 2007
generation impossible without a
special procedure for converting for fuel oil. For coal, the caloric in comparison with 2006, and by
various units of measurement value varies from (according to 3.7 kg/Gcal in comparison with
(tons, m3) to an equatable form. concluded contracts) 2200 kcal/ 2005, due to plant heating takeoff
kg to 6300 kcal/kg depending on loads.
For this purpose, physical fuel is the type of coal.
converted into oil equivalent in
technical records. Data on fuel consumption in
reference measurement are used
A oil equivalent unit is an
in planning and analysis of
accounting unit of organic fuel
used to compare the efficiency of specific fuel consumption per
various forms of fuel and their unit of energy, as well as for
total amounts. The accepted oil calculating production costs of
equivalent unit is 1 kg of fuel with electric power and heat.
a heating value of 7,000 kcal/kg
(29.31 MJ/kg). The relationship Use of oil equivalent is
between units of reference and particularly convenient for
physical fuel is expressed by the comparing the efficiency of
formula:
various heat installations. The size
QP
H
of the SRFC is likewise influenced
BY = BH = Э . BY by GRES operating modes.
7000
Using oil equivalent, the fuel
where:
balance or the overall industry
BY is the amount of oil equivalent
power balance may be
in kg ;
constructed.
BH is the amount of physical solid
and liquid (kg) and gaseous (m3);
| PRODUCTION ACTIVITIES
30 | 31
SPECIFIC OIL EQUIVALENT CONSUMPTION 2005 2006 2007
FOR ELECTRIC POWER SUPPLY IN 2005– goe/kWh goe/kWh goe/kWh
2007, GOE/KWH
TOTAL FOR “OGK-6” 362.8 362.5 360.6
Ryazanskaya GRES 349.7 349.8 347.1
Novocherkasskaya GRES 374.7 373.2 370.8
Kirishskaya GRES 348.5 350.1 345.0
Krasnoyarskaya GRES-2 400.3 393.5 389.3
Cherepovetskaya GRES 377.3 379.1 378.7
GRES-24 325.8 322.8 323.3
SPECIFIC OIL EQUIVALENT CONSUMPTION 2005 2006 2007
FOR HEAT PRODUCTION IN 2005–2007, kgoe/Gcal kgoe/Gcal kgoe/Gcal
KGOE/GCAL
TOTAL FOR “OGK-6” 154.7 152.8 151.0
Ryazanskaya GRES 180.1 183.2 181.4
Novocherkasskaya GRES 198.9 197.0 194.8
Kirishskaya GRES 143.6 144.5 142.0
Krasnoyarskaya GRES-2 164.9 157.3 157.4
Cherepovetskaya GRES 183.9 186.9 185.6
4. FUEL MIX million tons more than in 2006 (a absence of limitations on gas
2.8% increase) and 1.88 million supply, fuel oil consumption
The following fuel mix formed for tons more than in 2005 (a 26.6% decreased significantly in 2007.
OGK-6 in 2007: coal — 44.0%; increase). Gas consumption in Fuel oil consumption in 2007 was
gas — 55.2%; fuel oil — 0.8%. 2007 increased by 0.63 billion m3 69.9 thousand tons, or nearly two
(an increase of 12%) to 5.89 billion times less than in 2005 and nearly
Overall, for OGK-6 in 2007 coal m3. As a result of reduced electric seven times less than in 2006.
consumption was 8.97 million power generation at Kirishskaya
tons of physical fuel, or 0.25 GRES due to a mild winter and the
FUEL CONSUMPTION IN PHYSICAL UNITS
GAS, million m3 | COAL, thousand tons | FUEL OIL, thousand tons
2005 2006 2007 2005 2006 2007 2005 2006 2007
TOTAL FOR OGK-6 5,272.6 5,256.7 5,890.3 7,083.9 8,723.2 8,968.7 129.7 473.6 69.9
RGRES 1,368.8 1,394.8 1,628.6 1,528.9 1,904.3 1,893.5 6.4 79.9 1.6
NchGRES 1,014.6 981.2 1,156.5 2,198.5 2,788.1 2,614.5 3.2 13.8 0.0
KiGRES 1,895.9 2,002.5 2,141.4 – – – 116.8 373.3 65.3
KGRES-2 – – – 2,858.2 2,929.1 3,451.5 3.1 2.5 1.9
ChGRES 581.4 405.8 470.3 451.8 1,101.7 1, 009.1 0.3 4.2 1.1
GRES-24 412.0 472.4 493.5 – – – – – –
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
GAS CONSUMPTION (BY TYPE OF FUEL GAS) IN 2006–2007, MILLION M3
2006 (million m3) | 2007 ( million m3)
LIMITED GAS ABOVE-LIMIT GAS COMMERCIAL GAS GAS, TOTAL LIMITED GAS ABOVE-LIMIT GAS COMMERCIAL GAS ADDITIONAL GAS GAS, TOTAL
TOTAL FOR OGK-6 3,625.1 305.3 1,326.3 5,256.7 3,650.3 414.3 1,065.1 760.5 5,890.3
RGRES 1,394.8 0.0 0.0 1,394.8 1,420.2 80.3 21.7 106.3 1,628.6
NchGRES 898.6 82.6 0.0 981.2 925.4 63.0 168.1 0.0 1,156.5
KiGRES 599.7 183.4 1,219.4 2,002.5 539.6 173.5 792.8 635.5 2,141.4
ChGRES 405.8 0.0 0.0 405.8 436.4 33.9 0.0 0.0 470.3
GRES-24 326.2 39.3 106.9 472.4 328.7 63.6 82.5 18.7 493.5
The volume of limited gas used by of coal in 2007 in comparison with can operate on coal and up to
subsidiaries of JSC “OGK-6” 2006 for OGK-6 as a whole was 62.9% (5,696 MW) of the installed
increased by 7% in 2007 in 0.09%. The share of gas in 2007 capacity can operate on gas. This STRUCTURE OF GAS CONSUMPTION
comparison with 2006. For the increased by 4.62% in comparison enables the Company to react to BY JSC “OGK-6” PLANTS
purpose of reducing the share of with 2006, primarily due to a fuel price changes and shift from IN 2006–2007, %
highly priced fuel oil in the fuel reduction of the share of fuel oil one type of fuel to another,
balance at JSC “OGK-6” subsidiaries from 5.51% in 2006 to 0.8% in 2007. efficiently managing the fuel mix.
and due to agreements reached
with suppliers of natural gas, the Part of the Company’s strategy is 25.23%
volume (above-limit and to optimize of the fuel balance of
commercial) of additional gas the plants and to minimize fuel
supplied in 2007 was increased by expenses. A total of 18.6% of the
37%. installed capacity of JSC “OGK-
5.81 %
6”can operate on both gas and
In 2007, the upward trend in the coal. Depending on the fuel price
share of coal in the fuel mix situation, up to 55.7% (5,042 MW) 68.96 %
continued. The increase in the share of the installed capacity of OGK-6
2006
12.91 %
FUEL MIX OF JSC “OGK-6” PLANTS 18.08 %
IN 2005–2007, %
100 1.76% 5.51% 0.8% 7.03 %
— Fuel oil
61.97 %
— Gas
— Coal 2007
59.98% 50.54% 55.16%
— Limited gas
39.26% 43.95% 44.04% — Above-limit gas
2006 2007
— Commercial gas
— Additional gas
0
2005 2006 2007
| PRODUCTION ACTIVITIES
32 | 33
FUEL MIX OF JSC “OGK-6” PLANTS — Coal — Gas — Fuel oil
IN 2005–2007, %
70.1 60.7 67.5 42.8 35.0 40.4 93.0 81.4 96.4 0.3 0.2 0.1 69.3 39.7 43.9 100 100 100
0.2 0.6 0.0 0.0 0.5 0.1
0.3 4.0 0.1
7.0 18.6 3.6
29.6 35.3 32.4 57.0 64.4 59.6 99.8 99.8 99.9 30.3 59.9 56.0
2005 2006 2007 2005 2006 2007 2005 2006 2007 2005 2006 2007 2005 2006 2007 2005 2006 2007
RGRES NchGRES KiGRES KGRES-2 ChGRES GRES-24
FUEL MIX OF JSC “OGK-6”
AND JSC “OGK-6” PLANTS, %
2005 | 2006 | 2007
Coal Gas Fuel oil Total fuel Coal Gas Fuel oil Total fuel Coal Gas Fuel oil Total fuel
OGK-6 39.26 58.98 1.76 100 43.95 50.54 5.51 100 44.04 55.16 0.80 100
RGRES 29.59 70.07 0.34 100 35.27 60.71 4.01 100 32.38 67.54 0.08 100
NchGRES 57.01 42.83 0.16 100 64.43 34.99 0.58 100 59.56 40.44 0.00 100
KiGRES – 92.96 7.04 100 – 81.41 18.59 100 – 96.38 3.62 100
KGRES-2 99.75 – 0.25 100 99.78 – 0.22 100 99.86 – 0.14 100
ChGRES 30.34 69.29 0.04 100 59.85 39.66 0.49 100 55.99 43.89 0.12 100
GRES-24 – 100 – 100 – 100 – 100 – 100 – 100
4,010
3,356 310
TECHNICAL GENERATING CAPACITY
OPERATING CAPABILITIES
USING VARIOUS FORMS OF FUEL, MW
1,250 2,100
1,686
1,056 630
1,050 1,050 1,600
Coal alone Coal or gas Gas alone
— RGRES — NchGRES — KiGRES — KGRES-2 — ChGRES — GRES-24
34 | 35 | ANNUAL REPORT
| 2007
| JSC “OGK-6”
3 INVESTMENT
ACTIVITIES
TGV
OGK-6 PLANS TO INCREASE THE CAPACITY OF ITS POWER PLANTS
BY 1270 MW BEFORE 2011. THIS CAPACITY IS ENOUGH TO PROVIDE
SIMULTANEOUS OPERATION OF 100 UP-TO-DATE TVG TRAINS WHICH
ACCELERATE TO 500 KM/H.
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
3. INVESTMENT
ACTIVITIES
JSC “OGK-6” CONDUCTS INVESTMENT ACTIVITIES
IN THE FOLLOWING AREAS:
− IMPLEMENTATION OF MAJOR INVESTMENT PROJECTS;
− MODERNIZATION OF EXISTING INDUSTRIAL CAPACITIES.
MAJOR INVESTMENT PROJECTS
PROJECT PLANT INVESTMENTS YEAR OF COMMISSIONING CAPACITY INCREASE
in million rub., incl. VAT MW
Modernization of GRES-24 through addition of a 110 MW GRES-24 3 688 4th quarter 2009 110
turbine (CCP-420) to a 310 MW generation unit
Modernization of unit №6 of Kirishskaya GRES (CCP-800) Kirishskaya GRES 17,868* 4th quarter 2010 500
Construction of unit №9 of Novocherkasskaya GRES based Novocherkasskaya GRES 16,191 4th quarter 2011 330
on CCS technology
Construction of generation unit №4 of Cherepovetskaya GRES, Cherepovetskaya GRES 19,444* 4th quarter 2011 330
330 MW capacity
TOTAL MAIN PROGRAM 57,191 1,270
SCHEDULE FOR COMMISSIONING
NEW CAPACITIES
10,500
330
500 500
110 110 110
9,052 9,052 9,052 9,052 9052 9,052
0
2006 2007 2008 2009 2010 2011
— GRES-24 —KiGRES — NchGRES — ChGRES
| INVESTMENT ACTIVITIES
36 | 37
I. MAJOR INVESTMENT Due to implementation of major
PROJECTS investment projects, by 2011 the
installed capacity of OGK-6 will
At present, OGK-6 is implementing increase by 1,270 MW to 10,322 MW.
four major investment projects
approved by the Company’s Board
of Directors in March 2007.
AMOUNT OF FINANCING OF MAJOR INVESTMENT PROJECTS, IN MILLION RUB., INCL. VAT
PROJECT 2006 ACTUAL 2007 ACTUAL 2008 PLAN 2009 PLAN 2010 PLAN 2011 PLAN TOTAL FOR 2007–2011
Modernization of GRES-24 through addition of a 110 MW turbine 8.10 573.03 1,967.96 1,042.29 75.34 21.28 3,688
(CCP-420) to a 310 MW generation unit
Modernization of block №6 of Kirishskaya GRES (CCP-800) 25.31 2,488.33 4,780.52 6,221.86 4,106.77 245.21 17,868
Construction of block №9 of Novocherkasskaya GRES based 11.04 851.52 5,357.06 4,280.82 3,081.04 2,609.52 16,191
on CCS technology
Construction of generation unit №4 of Cherepovetskaya GRES, 0.00 26.15 2,341.98 6,321.16 5,601.14 5,153.57 19,444
330 MW capacity
TOTAL FOR ALL PROJECTS 44.45 3,939.03 14,447.52 17,866.13 12,864.29 8,029.58 57,191
* — excluding payment for technical connection.
AMOUNT OF FINANCING OF MAJOR
INVESTMENT PROJECTS,
IN MILLION RUB. (WITH VAT)
— Construction of start-up complex of Cherepovetsky
20000
GRES (coal power unit #4, 330 MW) at stand-by
configuration (3*330 MW)
— Modernization of GRES-24 through addition to a 310
MWt power unit of a 110 MWt gas turbine
— Construction of unit #9 of Novocherkassky GRES on
the basis of CCS technology
0
— Modernization of the condensate part of JSC “OGK-6”
subsidiary Kirishkaya GRES on the basis of combined 2007 (f) 2008 (f) 2009 (p) 2010 (p) 2011 (p)
cycle technology
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
MODERNIZATION OF GRES-24 The project adds a 110 MW treatment point with gas mains on
BY ADDING A 110 MW TURBINE turbine to the existing 310 MW the GRES-24 site, reconstruction of
(CCP-420) TO A 310 MW unit on a rejection scheme. The the existing gas placement station
GENERATION UNIT existing P-74 boiler, originally (GDS), and laying of a high-pressure
At present, GRES-24 consists of a designed for work with a MHD gas main from the gas placement
single 310 MW-capacity steam- (magnetohydrodynamic) station (GDS) to the GRES-24 site.
generation unit. This generation generator, ideally suites for work in Output from the gas turbine unit
facility belongs to the Central a combined cycle installation on a (GTU-110) is provided for on the
integrated power system, which is rejection scheme. 500 kW buses of Ryazanskaya GRES
currently experiencing a power via the existing flexible connection
shortage. Figure [1] shows the principle (HV-500 kV) of the GRES-24
operating scheme of CCP-420. The generation unit. New equipment
According to the conducted gas-air mixture is supplied to the will be installed during a major
marketing studies a significant combustion chamber (CC) of the overhaul and will take no more
increase in demand for electric gas-turbine installation and the than 6 months in 2009.
power and output is expected in combustion products perform the
the near future in the Central work in the gas turbine, upon Specific oil equivalent
integrated power system. completion of which they are consumption of the modernized
jettisoned into the boiler. In the generation unit is 279 g/kWh, with
Implementation of the project will boiler, the heat of departing GTU a performance factor (PF) of 44%.
make it possible to increase the gases is used to generate the steam At present, the specific fuel
competitiveness of GRES-24 on the supplied to the steam turbine. consumption of the generation
electric energy and power market, unit is 312 g/kWh, with PF 39.5%.
increase Company profits due to The project includes complex
improved productivity and installation of the gas turbine unit In 2007, an agreement was made
increased electric power supply, (GTU-110), reconstruction of the with the Teploelektroproekt
and meet the growing demand for bottom part of the existing P-74 Institute, a subsidiary of JSC UES
electric power in the Central IPS. boiler, construction of a gas Engineering Center, to prepare a
PICTURE 1 PRINCIPAL WORK LAYOUT
OF 420 MW CCGT
Direct steam
Gas Exhaust gas
Air
Existing
boiler P-74
Generator
Generator
Gas turbine Steam
Air compressor turbine
Exhaust gas
GTU-110
SUPERSTRUCTURE
Condenser
Feeding water
Steam chimney
EXISTING STRUCTURE
| INVESTMENT ACTIVITIES
38 | 39
feasibility study and working MODERNIZATION OF UNIT #6 capacity of 279 MW each, with two
documentation. The approved part OF KIRISHSKAYA GRES drum-type waste heat boilers, to
of the design has been received (CCP-800) the existing steam turbine of the
from JSC Engineering Center, According to marketing research sixth unit of Kirishsky GRES, 300
Teploelektroproekt Institute, and the power system of the Northwest MW capacity.
working documentation has been is experiencing a deficit; moreover,
developed for the preparatory the growth of consumption is The existing steam turbine of the
period and groundwork. The exceeding the planned sixth generation unit is subject to
approved part of the design has commissioning of new capacities. reconstruction, taking into account
been submitted to the its use in the combined cycle plant
Glavgosekspertiza. Working The investment project to (CCP). As a result, its installed
documentation is being processed modernize the plant’s generation capacity is being reduced from
. unit has been developed with a 300 MW to 260 MW.
In April, a contract was concluded with view to enhancing the
JSC NPO Saturn for supply of a gas competitiveness of Kirishskaya GRES, Figure 2 shows the principle
turbine unit (GTU-110). The equipment to raise efficiency of the process, and operating scheme of CCP-800. The
is currently being prepared. to cover the increased demand for gas-air mixture is supplied to the
and projected deficit of electric combustion chamber (CC) of the
In December, a contract was power in the region,. The sixth unit is gas-turbine installations and the
concluded with JSC UES the newest unit of the plant. Its combustion products perform the
Engineering Center for owner/ modernization will make it possible work in the gas turbine, upon
developer services. to synchronize the service life of the completion of which they are sent
existing steam turbine after into the waste heat boiler. In the
Work on the project is on schedule. reconstruction with the service life of waste heat boiler, the heat of
the newly acquired equipment. departing gases of the gas turbine
The planned date for unit (GTU) is used to generate the
commissioning the unit is the The design provides for the steam supplied to the steam
fourth quarter of 2009. addition of two gas turbines with a turbine.
PICTURE 2 PRINCIPAL WORK LAYOUT
OF 800 MW CCGT
Steam chimney
Steam
Gas
Combustion
unit Steam
Air Exhaust turbine
heat boiler with reduced
Gas indicators
Air turbine Generator
Generator compressor
GTU-270 Exhaust gas
Gas
Combustion
Air unit
Condenser
Exhaust
Generator Air Gas heat boiler
compressor turbine
GTU-270 Exhaust gas Feeding water
SUPERSTRUCTURE
EXISTING STRUCTURE
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
The installation of the new erected addition to the main with a capacity of 279 MW each).
equipment will coincide with a building, in which the gas turbine These are currently in the
major overhaul and will take no and boiler equipment will be production stage.
more than 6 months in 2009. installed, is highlighted.
In December, a contract was
Specific oil equivalent For the purposes of realizing the concluded with ZAO SMU SZEM for
consumption of the modernized CCP-800 construction project, in preparatory work on the project.
generation unit is 221 g/kWh, with 2007 a contract was concluded
a performance factor (PF) of 54%. with JSC SevZap NTC for In March 2008, following a two-
At present, the specific oil developing a feasibility study (FS) stage competitive tender, JSC VIS
equivalent consumption of the and working documentation. To Production Company became the
generation unit is 343 g/kWh, date, the FS and working general contractor for the
with PF 37%. documentation for the preparatory construction of CCP-800.
period and ground work have
In realizing the project, the existing been received from JSC SevZap Work on the project is on schedule.
infrastructure of Kirishskaya GRES NTC. The necessary documentation
will be used as far as possible, packet has been compiled for The planned date for
namely: the project will be submission to Glavgosekspertiza. commissioning the unit is the
implemented on existing plant fourth quarter of 2010.
sites, and existing auxiliary and In 2007 contracts were concluded
common equipment, the existing for the supply of equipment
electrical output scheme with requiring an extended production CONSTRUCTION OF BLOCK #9
expansion of outdoor switchgear time. In September 2007, a OF NOVOCHERKASSKAYA GRES
(OS), and the existing water supply contract was concluded with JSC BASED ON CCS TECHNOLOGY
scheme will be used. EMAlliance for the supply of waste According to marketing studies
heat boilers, as well as a contract that have been conducted, an
Figure 3 depicts a schematic plan for supply of gas turbine units (two increase in power consumption
of Kirishskaya GRES. The newly Siemens SGT5-4000F installations may be noted in the Southern
PICTURE 3 KIRISHI GRES POWER PLANT
LAYOUT
| INVESTMENT ACTIVITIES
40 | 41
integrated power system (IPS). The vacant lot of the plant. The main occurs at a bed temperature of 850
increase in power consumption is scheme of the generation unit is °C – 900 °C. During low-ash fuel
caused by the expansion of presented in Figure 4. combustion, sand is used for the
metallurgical production, oil material of the bed. If the fuel
refining, engineering, and the coal Operating principle of the fluidized contains sulphur, in order for it to
industry in the region, which bed boiler (Fig. []-[]) bond, lime is added to the firing, in
determines demand for an which case the material of the bed
increase in the total installed Figure 5 shows a schematic view consists of a mixture of fuel ash and
capacity of power plants of the of the CFB boiler. The material of lime.
integrated power system (IPS). the boiler is brought to a
suspended state (so-called Specific oil equivalent consumption
Realization of the project will make “fluidized bed”) by blowing air of the generation unit is 323.5 g/
it possible to increase the through the material of the bed kWh, with a performance factor (PF)
competitiveness of lying on the lattice/air distributor of 39%.
Novocherkasskaya GRES on the (fig. []). At high air speeds the bed
electric energy and power market, expands, and several particles of The primary and auxillary
increase Company profits due to the bed along with the unburnt equipment of the new unit, as well
improved productivity and fuel particles are carried away from as the electrical device unit, are
increased electric power supply, and the bed along with the departing housed in a separate building
to withdraw existing equipment gases. The largest of the particles adjoining the Main building.
that has exhausted its resources for being carried away are separated in
reconstruction. a cyclone and return again to the Part of the existing plant
fluidized bed, resulting in more infrastructure will be used in
The project for modernization of the complete fuel consumption. This implementing the investment
Novocherkasskaya GRES consists of comprises the operating principle project, namely: the existing coal
construction of a new generation of the circulating fluidized bed on storehouse will be expanded to 400
unit with a capacity of 330 MW, the basis of which CFB boilers thousand tons, and will be used for
with installation of a circulating operate. Air speed is approximately both existing and newly
fluidized bed (CFB) boiler, on a 5 m/s. Combustion ordinarily implemented equipment.
PICTURE 4 PRINCIPAL LAYOUT OF POWER
GENERATING UNIT OF NOVOCHERKASSK
GRES POWER PLANT OF TOTAL CAPACITY
330 MW WITH CENTRAL CONTROL BOILER
Steam
Chimney
Exhaust gas
Generator
Boiler Steam
with System turbine
Central Control
Fuel+Air
Condenser
Feeding water
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
Moreover, a new fuel feed conveyor supply of a CFB boiler. The boiler is the electric power market, the
tunnel to the new unit is planned, as currently in production. investment project proposes
well as installation of an additional construction of a generation unit of
car dumper. Power output of the A tender for supply of a gas turbine Cherepovetskaya GRES, as well as
new unit will take place via existing with a generator has ended with NP modernization and creation of new
330 kW voltage lines with Energoremfond being declared the infrastructure for the plant, which
installation of an additional outdoor winner (production by JSC will ultimately make further
switchgear box (OS-330 kW). The Turboatom, Kharkov). Contract expansion of generating capacities
project provides for using the negotiations are being conducted. possible.
existing water supply scheme with
the installation of two three- The project is planned for The expansion of Cherepovetskaya
sectional dry coolers. Other implementation according to the GRES is planned through
common equipment will be EPCM (Engineering Procurement construction of a generation unit
employed as well. Construction Management) with 330 MW capacity and using
contract scheme. coal as fuel.
Using the existing infrastructure of
Novocherkasskaya GRES will make it The planned date for The expansion of Cherepovetskaya
possible to minimize investment commissioning of the new unit is GRES is planned on an area of the
costs for realization of the project. the fourth quarter of 2011. electric power plant grounds free of
major development, located in the
The newly erected building of the community of Kadui in Vologda
main building of the new unit, as CONSTRUCTION OF Region 40 km from Cherepovets —
well as the fuel feed tunnel, are GENERATION UNIT #4 OF a major industrial hub and the
depicted in Figure 6 (highlighted CHEREPOVETSKAYA GRES, primary consumer of electric power
in red). 330 MW CAPACITY produced by the GRES.
Under conditions of the growing
In September 2007, a contract was power deficit of the Vologda Region The primary and auxillary
concluded with JSC EMAlliance for and increased competitiveness on equipment of generation unit #4 is
PICTURE 5 OPERATING PRINCIPLE
OF FLUIDIZED BED BOILER
Steam outlet
Limestone
Feeding water inlet
Fuel
Cyclone
Steam gas
Burner
Electric filter
Fly ash
Bottom ash
Exhauster
Secondary air ventilator
Pass to ash bunker Primary air ventilator
Fuel
Circulating boiling air
| INVESTMENT ACTIVITIES
42 | 43
housed in the newly erected main A single-cooler reversible circulating developed an investment feasibility
building. water supply system is planned. A study and business plan for the
membrane technology-based water project.
Construction of a new fuel treatment system is likewise
conveying system is planned, the provided for. The project is planned for realization
buildings and installations of which according to the EPC (Engineering
will include: a coal storehouse, an A dry ash removal system is Procurement Management)
unloading device with car dumper, proposed in the expanded part of scheme.
a conveyer belt gallery, filling the GRES in order to eliminate light
stations, a crusher, a fuel separator, and bottom ash formed during coal The planned date for
and a defroster. combustion in the boilers. commissioning of the new unit is
the fourth quarter of 2011.
A reinforced concrete smokestack In 2007, Nizhegorodsky
with a mouth 8.4 m in diameter and Teploelektroproekt, a subsidiary of
180 m in height is being installed. JSC UES Engineering Center,
PICTURE 6 NOVOCHERKASSK GRES
POWER PLANT LAYOUT
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
II. MODERNIZATION OF The most important operations According to the results of 2007,
EXISTING INDUSTRIAL planned for implementation in 2007 there were no significant
CAPACITIES were accomplished their entirety. differences between actual use of
capital investments and planned
The investment program plan of The significant difference between use among other TR and R
JSC “OGK-6” for 2007 provided for the actual use of capital projects.
the use of capital investments for investments and the planned use
technical reequipment and of JSC “OGK-6” subsidiary Insignificant deviations in
reconstruction (TR and R) in the Novocherkasskaya GRES according fulfillment of TR and R programs
amount of 1,707,139 thousand to 2007 results is due to by JSC “OGK-6”subsidiaries are due
rubles (without VAT). Actual use of anticipatory fulfillment of the to corrections to the work and
capital investments for TR and R supply schedule of primary equipment procurement
was 1,813,856, or 106.3%. equipment for the investment schedules made by contractors of
project “Reconstruction of unit №7 the subsidiaries, as well as transfer
The main results of the technical turbine” for the purposes of of the use of capital investments
reequipment and reconstruction ensuring obligatory for a series of projects of the 2007
financing program of JSC “OGK-6” implementation of the project investment program to 2008.
are presented in the table below. within the planned timelines.
JSC “OGK-6” SUBSIDIARIES USE OF CAPITAL INVESTMENTS FOR TR AND R OF JSC “OGK-6” IN 2007 IMPLEMENTATION OF THE TR AND R
PLAN ACTUAL % ACCOMPLISHED PROGRAM OF JSC “OGK-6” FOR 2007
thousand rubles thousand rubles thousand rubles
TOTAL FOR JSC “OGK-6”, incl.: 1,707,139 1,813,856 106.3%
Ryazanskaya GRES 403,024 379,748 94.2%
GRES-24 116,391 125,056 107.4%
Krasnoyarskaya GRES-2 78,054 76,964 98.6%
Kirishskaya GRES 952,968 948,490 99.5%
NovocherkasskayaGRES 104,091 230,890 221.8%
Cherepovetskaya GRES 52,611 52,708 100.2%
| INVESTMENT ACTIVITIES
44 | 45
III. RESULTS OF An insignificant deviation in
INVESTMENT ACTIVITIES fulfillment of the JSC “OGK-6”
FOR 2007 investment project in 2007 was
due to alteration of work and
The investment program plan of equipment procurement
JSC “OGK-6” in 2007 provided for schedules, as well as to transfer of
the use of capital investments of the use of capital investments for
2,004,298.0 thousand rubles; actual several medium and small projects
use was 1,988,812.6 thousand to 2008.
rubles, or 99.2%.
AMOUNT OF INVESTMENTS AND NAME OF SUBSIDIARY AMOUNT OF INVESTMENTS COMMISSIONING OF FIXED ASSETS
COMMISSIONING OF FIXED ASSETS thousand rubles (without VAT) Investment amount
FOR JSC “OGK-6” SUBSIDIARIES IN 2007
TOTAL: 1,988,812.6 765,785.3
Ryazanskaya GRES 389,669.5 132,838.1
Novocherkasskaya GRES 314,197.0 164,148.9
Kirishskaya GRES 948,490.4 295,965.9
Krasnoyarskaya GRES-2 80,964.0 75,809.0
Cherepovetskaya GRES 98,445.0 65,843.0
GRES-24 127,027.0 11,458.0
Executive office 30,019.6 19,722.5
INCLUDING FOR MAJOR PROJECTS: 443,719.5 5,464.0
– including for the project “Addition of a GT-110 gas turbine 117,499.0 0
to 310 MW unit ” at GRES-24
– including for project “Construction of 330 MW coal CFB 65,895.0 5,464.0
generation unit №9” at Novocherkasskaya GRES
– including for the project “Construction of CCP-800 MW on the base 214,588.5 0
of existing 300 MW generation unit №6” at Kirishskata GRES
– including for the project “Construction of 330 MW coal CFB 45,737.0 0
generation unit №4” at Cherepovetskaya GRES
* Volumes presented are for work accepted as per acts of 2007.
** Data presented are for fixed assets commissioned in 2007, with consideration of facilities for which construction began in earlier periods.
The Creac’h Lighthouse
THE CREAC’H LIGHTHOUSE IS THE BRIGHTEST LIGHTHOUSE IN EUROPE.
FOR DECADES, IT HAS BEEN SHOWING THE RIGHT DIRECTION TO
SEAGOING VESSELS. IN 2007, RETURN ON SALES OF OGK-6 EXCEEDED 10%.
TODAY, THIS IS A GOOD LANDMARK FOR COMPANIES OF THE SECTOR.
| ANNUAL REPORT
| 2007
| JSC “OGK-6”
46 | 47
4 ECONOMY
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
4. ECONOMY
OPERATING ACTIVITY FACTORS
I. EARNINGS Total earnings from heat sales in reducing representation of
2007 remained practically on the earnings for other products for all
Earnings of JSC “OGK-6” in 2007 level of 2006, amounting to JSC “OGK-6” subsidiaries as of
were 35,333,820 thousand 1,813,139.4 thousand rubles. January 1, 2007, to a single
rubles or 21.2% more than template in accordance with the
consolidated earnings for 2006 . Earnings from sales of other accounting policy of JSC “OGK-6”;
products/services relating to hence, part of the income from
Total earnings from sales of electric primary activities in 2007, which non-core activities was transferred
energy and power in 2007 were include earnings from sales of to primary activities, in particular,
33,195,199 thousand rubles. chemically treated water, payment for the “property rental” category.
for nonreturn of condensate, Likewise, individual non-core
The 23.4% increase in earnings payment for heat delivery services, forms of activity were eliminated
from electric energy and power earnings from property rental, etc., (withdrawal of cafeteria, hospitals,
sales in 2007 in comparison with were 314,044.4 thousand rubles etc.). The main reduction in
2006 is due to both the increase in earnings was caused by rental of
generation of in-house electric Income from sales of products/ an ecological equipment
power and the increase in sales of services relating to non-core workshop at subsidiary GRES-24
purchased electric power. The activities in 2007 was 11,437.2 during the fourth quarter of 2006,
share of electric power purchased thousand rubles. The 94.3% resulting an earnings reduction for
for resale in the electric power decrease in earnings from sales of the category “Production of
sales structure increased from 6% products/services relating to non- nonstandardized equipment” of
in 2006 to 18% in 2007. core activities is a result of 77,858 thousand rubles.
EARNINGS STRUCTURE, THOUSAND RUBLES
EARNINGS 2006 | 2007 | 2007/2006
thousand rubles share in earnings, % share in earnings% %
TOTAL EARNINGS: 29,150,427.9 100% 35,333,820.0 100% 121.2%
INCLUDING:
Earnings from sales of electric energy and power, of which: 26,898,738.8 92% 33,195,199.0 94% 123.4%
– from electric energy sales: 18,626,941 64% 23,373,656.4 66% 125.5%
– from power sales: 8,271,797.8 28% 9,821,542.6 28% 118.7%
Earnings from heat sales 1,829,865.5 6% 1,813,139.4 5% 99.1%
Earnings from sales of other products/services related to primary activities 219,968 0.8% 314,044.4 0.9% 142.7%
Earnings from sales of other products/services related to non-core activities 201,855.6 0.7% 11,437.2 0.03% 5.7%
| ECONOMY
48 | 49
II. PRODUCTION COST 2006, as well as increasing fuel comparison with 2006, or by Depreciation deductions are
prices. 2,612,823 thousand rubles, due calculated with allowance for
Production cost in 2007 in to the increased share of electric commissioning of fixed assets.
comparison with 2006 increased Equipment repair costs calculated as power purchased for resale.
by 17.7%, amounting to part of the feedstock and materials,
31,629,550 thousand rubles. The production labor and services, and Expenses for labor compensation
greater part in the production cost labor compensation expenses in and UST for 2006 increased by
structure (67.38%) is comprised of 2007 exceeded those for 2006 by 538,582 thousand rubles or
variable costs, primarily caused by 101,328 thousand rubles, or 3.5%. 27.5%, due to indexation of the
fuel costs. The share of fuel costs Repair expenses amounted to base rate for first-category
in the overall production cost 2,888,804 thousand rubles in workers,as well as the transition
structure in 2007 was 56.59%. 2006, and 2,990,132.4 thousand to an integrated labor
rubles in 2007. The share of repair compensation system beginning
The increase in fuel costs in expenses in the production cost on January 1, 2007.
absolute values by 3,963,364 structure for 2006 was 9.45%, or
thousand rubles in 2007 is due to 1.29% less than in 2006. Depreciation costs in 2007 were
the 3.5% increase in in-house 1,186,766.3 thousand rubles, or
electric power generation by JSC Purchased electric power costs in 132,232.3 thousand rubles more
“OGK-6” plants in comparison with 2007 increased 4.5 times in than depreciation costs in 2006.
PRODUCTION COST STRUCTURE FOR 2006–2007
PRODUCTION COST 2006 | 2007 | 2007/2006
thousand rubles share in total production cost, % thousand rubles share in total production cost, % %
TOTAL PRODUCTION COST 26,876,690.2 100,00% 31,629,550.0 100% 117,7%
Variable costs 17,349,940.0 64.55% 21,313,304.1 67.38% 122.8%
Fuel costs 16,579,683.5 61.69% 17,899,159.5 56.59% 108.0%
Purchased electric power 747,224.4 2.78% 3,360 048.1 10.62% 449.7%
Process water 23,032.2 0.09% 54,096.5 0.17% 234.9%
Conventional costs 9,526,750.2 35.45% 10,316,245.9 32.62% 108.3%
Feedstock and materials 1,166,165.2 4.34% 1,283,332.9 4.06% 110.0%
Production labor and services 1,932,465.6 7.19% 1,916,849.0 6.06% 99.2%
Depreciation 1,054,534.0 3.92% 1,186,766.3 3.75% 112.5%
Labor compensation costs + UST 1,955,979.9 7.28% 2,494,561.6 7.89% 127.5%
Non-governmental pension funding 75,470.6 0.28% 128,958.9 0.4% 170.9%
Other expenses 3,342,134.9 12.44% 3,305,777.2 10.45% 98.9%
1 Due to the Company’s reorganization in the form of annexation of generating companies completed on For the purposes of deducting “non-liquid”assets of the AO-GRES prior to their annexation to OPEN JOINT-
September 29, 2006, the following results of financial and economic activities were entered into the profit STOCK COMPANY “OGK-6”, earnings received from electric power sales in 2006 were revised by the sum of the
and loss report for 2006: standard imbalance for a total amount of 681,240 thousand rubles, deduction of the standard imbalance of
– for OPEN JOINT-STOCK COMPANY OGK as the managing company, for 8 months and 28 days of 2006; previous years for a total amount of 1,839,182 thousand rubles, and deduction of assets and liablities and
– for GRES that became OPEN JOINT-STOCK COMPANY OGK-6 subsidiaries, for 2 days of the third quarter and restoration of VAT for a total amount of 531,958 thousand rubles. Detailed information regarding this may be
for the fourth quarter of 2006; obtained from the Annual Report of OPEN JOINT-STOCK COMPANY “OGK-6”for 2006.
– for the executive office of the reorganized OPEN JOINT-STOCK COMPANY “OGK-6”, for 2 days of the third
quarter and for the fourth quarter of 2006. For the purposes of analysis and comparison with 2007 indices, consolidated financial indices for 2006 were
calculated without accounting for deductions of non-liquid assets.
In order to make it possible to compare the results of Company’s financial and economic activities for 2007 and
2006, with consideration of the operation of all GRES, financial indices for 2006 were consolidated for the
purposes of this section on the basis of the following principles:
– for 2006, consolidated financial indices were formed by combining the indices of the GRES as separate legal
entities for a period of 8 months and 28 days of 2006 and the indices of the GRES as subsidiaries of OPEN
JOINT-STOCK COMPANY “OGK-6”for two days of the 3rd quarter and for the 4th quarter.
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
FUEL COSTS The principle consumer of fuel oil in 2007 was Kirishskaya GRES. The reduction
The primary changes in the fuel cost structure for 2007 were: in the share of fuel oil in the fuel mix in 2007 was due to its replacement with
gas at Kirishskaya GRES.
» an 11.26% increase in the share of gas expenses due to a 4.62% increase
(to 55.16%) in the share of gas in the fuel mix, both due to the reduction in The strategy in the area of fuel supply is aimed at optimizing the fuel balance
electric power generation by subsidiary Kirishskaya GRES using more and minimizing fuel costs. It provides for increasing the share of coal in the fuel
expensive fuel — fuel oil — and due to the increase in generation using balance, the maximum possible replacement of fuel oil with gas, fuel
gas and, correspondingly, greater gas consumption. The increased share of purchases through tendering, conclusion of long-term contracts for fuel
gas costs is likewise due to the change in the gas consumption supply, etc. In 2007, the Company concluded long-term contracts for supply of
structure — higher consumption of commercial and above-limit gas and limited gas with JSC Gazprom to 2011. Contracts for coal supply for the needs
an increase in gas prices. of JSC “OGK-6” subsidiaries, with the exception of supply of Podmoskovny coal
for the needs of Ryazanskaya GRES, Rostov coals for the needs of
» a 0.16% increase in the share of coal expenses, due to the increase in Novocherkasskaya GRES, and Borodinsky coal for the needs of Krasnoyarskaya
generation and the amount of coal burned. At the same time, the share of GRES-2 (in 2007), are renewed annually on the basis of open tenders. In May
coal in the fuel mix changed insignificantly, from 43.95% in 2006 to 44.04% 2007, JSC “OGK-6” concluded a contract with JSC Mosbassugol to supply
in 2007. Podmoskovny coal for the needs of Ryazanskaya GRES to 2011. The share of
Podmoskovny coal in the coal balance of the plant is 17–20%. Likewise, in
» reduction in the share of fuel oil costs from 13.86% in 2006 to 2.45% in December 2007, JSC “OGK-6” concluded a long-term contract for supply of
2007, caused by the reduction in the share of fuel oil in the fuel mix, from Borodinsky coal to Krasnoyarskaya GRES-2 for a three-year period at fixed
5.51% in 2006 to 0.8% in 2007. prices for 2008, 2009, and 2010. The share of Borodinsky coal in the coal
balance of Krasnoyarskaya GRES-2 is 100%.
FUEL COST STRUCTURE FOR 2006–2007
COSTS 2006 | 2007 | 2007/2006
thousand rubles share in total costs, % thousand rubles share in total costs, % %
TOTAL COSTS 16,579,684 100.00% 17,899,160 100% 108.0%
Coal 6,060,340 36.55% 6,571,642 36.71% 108.4%
Gas 8,220,938 49.58% 10,890,570 60.84% 132.5%
Fuel oil 2,298,406 13.86% 436,948 2.45% 19.0%
RYAZANSKAYA GRES 3,805,536 22.95% 4,492,161 25.09% 118.0%
Coal 1,558,156 9.40% 1,689,878 9.44% 108.5%
Gas 2,020,792 12.19% 2,795,792 15.62% 138.4%
Fuel oil 226,588 1.37% 6,491 0.03% 2.9%
NOVOCHERKASSKAYA GRES 4,025,700 24.28% 4,739,782 26.48% 117.7%
Coal 2,481,015 14.96% 2,615,955 14.61% 105.4%
Gas 1,493,558 9.01% 2,123,827 11.87% 142.2%
Fuel oil 51,127 0.31% 0 – –
KIRISHSKAYA GRES 5,481,270 33.06% 4,836,059 27.02% 88.2%
Coal – – – – –
Gas 3,482,746 21.01% 4,418,671 24.69% 126.9%
Fuel oil 1,998,524 12.05% 417,388 2.33% 20.9%
KRASNOYARSKAYA GRES-2 979,072 5.91% 1,206,690 6.74% 123.2%
Coal 967,127 5.83% 1,196,419 6.68% 123.7%
Gas – – – –
Fuel oil 11,945 0.07% 10,271 0.06% 86.0%
CHEREPOVETSKAYA GRES 1,569,547 9.47% 1,744,382 9.75% 111.1%
Coal 1,054,042 6.36% 1,069,390 5.97% 101.5%
Gas 505,283 3.05% 672,194 3.76% 133.0%
Fuel oil 10,222 0.06% 2,797 0.01% 27.4%
GRES-24 718,559 4.33% 880,085 4.92% 122.5%
Coal – – – – –
Gas 718,559 4.33% 880,085 4.92% 122.5%
Fuel oil – – – – –
| ECONOMY
50 | 51
FUEL COSTS (BY FUEL TYPE) GAS COST STRUCTURE FOR 2007
FOR 2006–2007, BILLION RUBLES
COST SHARE IN TOTAL GAS COSTS
thousand rubles %
16.58 17.90
2.45% GAS, TOTAL 10,890,570 100%
13.86% Limited gas 5,913,079 54%
Above-limit gas 846,110 8%
36.55% 36.71% Commercial gas 1,986,372 18%
Additional gas 2,145,009 20%
49.58% 60.84% RYAZANSKAYA GRES 2,795,793 26%
Limited gas 2,334,062 21%
Above-limit gas 168,022 2%
Commercial gas 45,161 0%
Additional gas 248,548 2%
2006 2007 NOVOCHERKASSKAYA GRES 2,123,827 20%
Limited gas 1,583,046 15%
Above-limit gas 131,292 1%
— Fuel oil Commercial gas 0 –
Additional gas 409,488 4%
— Coal
KIRISHSKAYA GRES 4,418,671 41%
— Gas Limited gas 840,567 8%
Above-limit gas 366,272 3%
Commercial gas 1,767,830 16%
Additional gas 1,444,002 13%
CHEREPOVETSKAYA GRES 672,194 6%
GAS COSTS (BY TYPE OF GAS USED) Limited gas 615,282 6%
FOR 2007 Above-limit gas 56,912 1%
Commercial gas 0 –
Additional gas 0 –
20 % GRES-24 880,085 8%
Limited gas 540,121 5%
Above-limit gas 123,612 1%
18 % Commercial gas 173,381 2%
54 % Additional gas 42,971 0%
Limited gas — gas volumes allotted by JSC Gazprom (produced by JSC Additional gas — gas volumes allotted by JSC Gazprom (produced by JSC
8%
Gazprom and its affiliated companies) at state-regulated (FTS RF) prices. Gazprom and its affiliated companies) beyond the volumes of the limited
gas contract, at prices according to RF Government Order №333 dated
Above-limit gas — actual overrun of gas in excess of volumes agreed on 05.28.2007.
— Limited gas in the limited gas supply contract.
— Above-limit gas Commercial gas — gas produced by independent producers not affiliated
with JSC Gazprom. The price of commercial gas is not regulated by the state
— Commercial gas (FTS RF).
— Additional gas
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
EARNINGS — PRODUCTION COST RATIO
The earnings — production cost ratio is an important parameter
reflecting the Company’s productivity. Earnings increases in 2007
outstripped the Company’s production cost.
2006 2007 2007/2006, % EARNINGS — PRODUCTION
COST RATIO FOR 2006–2007
Earnings, in thousand rubles 29,150,427.9 35,333,820.0 121.2%
Production cost, in thousand rubles 26,876,690.2 31,629,550.0 117.7%
Earnings/Production cost 1.085 1.117 –
III. GROSS PROFIT
For the end of 2007, gross income In 2007 an increase in gross profit
for JSC “OGK-6” plants was was noted for all subsidiaries
3,704,270 thousand rubles, or (exclusive of executive office costs).
1,430,532.3 thousand rubles
more than in 2006.
GROSS GRES PROFIT
STRUCTURE
FOR 2006–2007
3%
1%
7%
34 % 12 % 28 %
13 % — RGRES
— NchGRES
45 % — KiGRES
18 %
— KGRES-2
12 %
27 % — ChGRES
— GRES-24
2006 2007
| ECONOMY
52 | 53
GROSS GRES PROFIT 2006 2007 2007/2006 GROSS PROFIT OF SUBSIDIARIES FOR 2007
STRUCTURE FOR 2006–2007 thousand rubles thousand rubles % FOR REFERENCE (excluding EO costs)
TOTAL: 2,273,737.7 3,704,270.2* 162,9% 4,488,190.8
Ryazanskaya GRES 790,209.1 1,052,944.8 133.2% 1,205,896.2
Novocherkasskaya GRES 611,177.3 452,956.0 74.1% 629,436.4
Kirishskaya GRES 418,831.7 1,666,861.6 398.0% 1,802,791.6
Krasnoyarskaya GRES-2 285,482.3 435,928.7 152.7% 610,743.7
Cherepovetskaya GRES 18,806.2 -11,070.9 -58.9% 72,267.7
GRES-24 149,231.1 106,650.1 71.5% 167,055.2
* in accordance with the JSC “OGK-6” Accounting Policy, gross profit of JSC “OGK-6” subsidiaries is adjusted for executive office (EO) costs.
IV. EBITDA accepted corporate system of than profitability of the
EBITDA, THOUSAND RUBLES depreciation of fixed and consolidated EBITDA for 2006
EBITDA is earnings before interest, intangible assets. (11.84%).
taxes, depreciation, and
4,500,000 amortization. This indicator For the end of 2007, the EBITA
accurately reflects the financial indicator was 4,396,807 thousand
result of corporate operating rubles, or 27.44% more than in
activity, and makes it possible to 2006.
compare companies with one
another, as it is not dependant on Profitability of EBITDA on earnings
the taxation system, loan cost, or for 2007 was 12.44%, or 0.6% more
500,000 INDEX 2006 2007 2007/2006, %
2006 2007
EBITDA (thousand rubles) 3,449,990 4,396,807 127.44%
V. NET PROFIT Net profitability for the end of 2007 improved as a result of the
was 5.3% Return on equity (ROE) of replacement of short-term
Gross profit of JSC “OGK-6” for the JSC “OGK-6” for the end of 2007 was Company obligations with long-
end of 2007 was 1,873,621 5.37%, compared to 9.77% in 2006. term obligations.
thousand rubles, or 50.89% more At the same time, it should be
noted that equity increased 2 Profit for a single share is calculated in
than in 2006, taking into account
that in 2006, JSC “OGK-6” as a sole significantly — from 12,711,250 accordance with the Practical Recommendations
operating company existed only in thousand rubles in 2006 to for disclosure of information on profit per share,
the fourth quarter of 2006 and for 34,886,883 thousand rubles in approved by Order #29n of the RF Ministry of
two days of the third quarter. Net 2007. The acid test ratio (Rat) for Finance dated 03.21.2000.
profit for a single share of JSC “OGK- 2007 was equal to 3.51 compared
6” in 2007 was equal to 0.07 rubles2. to 0.27 in 2006. Liquidity
For reference:
Netprofit p. 190 form2
ROE = =
Equity p. 490 form1
Monetaryfunds + ShorttermFI + ShorttermAR + OtherCA
Ксл =
Shorttermmobl. – na – futureperiodincome
p. 250 form1 + p. 260 form1 + p. 240 form1 + p. 270 form1
=
p. 690 form1 – p. 640 form1
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
BALANCE STRUCTURE COMPOSITION OF FIXED CONSTRUCTION IN PROGRESS
ANALYSIS ASSETS Construction in progress amounts
No significant changes occurred in to 2,153,184 thousand rubles
ASSETS the composition of the fixed (4.92% of asset value). The main
According to JSC “OGK-6” assets of JSC “OGK-6” in 2007. reason for growth of assets under
accounting records for 2007, According to the balance, fixed “Construction in Progress” for 2007
assets are valued at 43,776,391 assets amounted 15,719,673 (by 1,211,068 thousand rubles) is
thousand rubles. The share of thousand rubles. the beginning of the long-term
non-circulating assets is 61.61%, investment program.
and that of circulating assets is As of year end 2007, buildings and
38.39%. installations at 10,732,532
thousand rubles (68.27%) and
vehicles, equipment, and
transportation at 4,939,487
thousand rubles (31.42%)
predominate in the composition
of fixed assets.
31.12.06 | 31.12.07 | 2007/2006 ASSETS
thousand rubles % of total assets thousand rubles % of total assets %
NONCURRENT ASSETS: 75.77% 61.61%
– fixed assets 16,130,343 15,719,673 97.5%
– construction in progress 942,816 2,153,884 228.5%
– long-term financial investments 53,242 8,575,166 16,106.0%
– other 565,424 522,493 92.4%
CURRENT ASSETS: 24.23% 38.39%
– reserves 3,176,790 3,323,191 104.6%
– long-term accounts receivable 501,768 2,626,988 523.5%
– short-term accounts receivable 1,729,448 3,754,579 217.1
– short-term financial investments 19,686 6,407,827 32,550.2%
– monetary funds 143,259 648,427 452.6%
– Other 86,937 44,163 50.8%
31.12.06 | 31.12.07 COMPOSITION OF FIXED
thousand rubles % thousand rubles % ASSETS
Buildings, installations, and relay devices 10,986,452 68.11 10,732,532 68.27
Vehicles and equipment, transportation 5,101,106 31.62 4,939,487 31.42
Other fixed assets 42,785 0.27 47,654 0.30
TOTAL: 16,130,343 100 15,719,673 100
| ECONOMY
54 | 55
LONG-TERM AND SHORT-TERM obtained from placement of an
FINANCIAL INVESTMENTS additional issue of Company
Long-term and short-term shares. Of the funds obtained from
financial investments for 2007 placement of the additional share
increased by 8,521,924 thousand issue, 8,518,420 thousand rubles
rubles and 6,388,141 thousand were allocated to long-term
rubles, respectively, in deposit, and 6,401,170 thousand
comparison with 2006, due to rubles to short-term deposit.
allocation to long-term and short-
term deposit of temporarily As of 12.31.2006, the Company
available monetary funds held shares of other companies.
LONG-TERM FINANCIAL INVESTMENTS OF JSC “OGK-6” IN SHARES OF OTHER COMPANIES AS OF 12.31.2006
NAME OF JOINT-STOCK COMPANY NUMBER OF ORDINARY SHARES PAR VALUE OF SHARE PACKAGE BOOK VALUE OF SHARE PACKAGE SHARE OF JSC “OGK-6”
thousand rubles thousand rubles in authorized share capital, %
JSC SKV 29,894,981.00 29,895 30,659 100
JSC SP 1,820,901.00 1,821 1,436 100
JSC Novomichurinskoe ATP 22,112,522.00 22,113 18,053 100
JSC Energoremstroy 4,868,001.00 4,868 3,094 100
TOTAL: 58,696,405.00 58,697 53,242
SHARES IN THE FOLLOWING COMPANIES WERE SOLD IN 2007:
NAMES HARE OF JSC “OGK-6” BOOK VALUE SELLING PRICE
in authorized share capital, % thousand rubles thousand rubles
JSC Energoremstroy 100 3,094 3,656
JSC SP 100 1,436 910
TOTAL: 4,530 4,566
Sales of non-core assets and maintenance and repair companies were conducted via public offering.
LONG-TERM FINANCIAL INVESTMENTS OF JSC “OGK-6” IN SHARES OF OTHER COMPANIES AS OF 12.31.2007
NAME OF JOINT-STOCK COMPANY NUMBER OF ORDINARY SHARE SPAR VALUE OF SHARE PACKAGE BOOK VALUE OF SHARE PACKAGE SHARE OF JSC “OGK-6”
thousand rubles thousand rubles in authorized share capital, %
JSC SKV 29,894,981 29,895 30,659 100
JSC Novomichurinskoe ATP 22,112,522 22,113 18,053 100
TOTAL: 52,007,503 52,008 48,712
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
CURRENT CAPITAL STRUCTURE rubles The increase in fuel Deferred expenses were reduced
In the structure of current assets, reserves was caused by the due to transfer of deferred
short-term financial investments overall increase in prices of expenses to other non-current
predominate at 38.13%, with delivered fuel, as well as a assets in accordance with
accounts receivable at 37.97% significant increase in fuel oil accounting rules.
and reserves at 19.77%. Reserves reserves at Kirishskaya GRES..
as of the end of 2007 increased The reduction in reserves of the
by 146,401 thousand rubles; remaining materials became
moreover, fuel increased by possible due to implementation
243,114 thousand rubles, and of an optimization program of
other material reserves warehoused materials and
decreased by 96,713 thousand equipment (excluding fuel).
INDICATOR 31.12.2006 | 31.12.2007 | 2007/2006 CURRENT CAPITAL STRUCTURE
thousand rubles % thousand rubles % %
RESERVES, of which: 3,176,790 56.15 3,323,191 19.77 104.6%
–
– Feedstock and materials, of which: 2,955,530 52.24 3,243,593 19.30 109.7%
Fuel oil 887,472 15.69 1,439,975 8.57 162.3%
Coal 1,162,604 20.55 853,370 5.08 73.4%
Other fuel 3,858 0.07 3,703 0.02 96.0%
– Deferred expenses 208,029 3.68 50,668 0.30 24.4%
Accounts receivable 2,231,216 39.44 6,381,567 37.97 286.0%
Short-term financial investments 19,686 0.35 6,407,827 38.13 32550.2%
Monetary funds 143,259 2.53 648,427 3.86 452.6%
Other (VAT and other current assets) 86,937 1.54 44,163 0.26 50.8%
TOTAL CURRENT ASSETS 5,657,888 100 16,805,175 100 297.0%
CURRENT CAPITAL STRUCTURE 0.4%
2%
3%
56 % 38% 20%
39%
38%
0.3%
4%
2006 2007
| ECONOMY
56 | 57
ACCOUNTS 6”. As of 01.01.2008, the amount of in the amount of advance fuel
RECEIVABLE advances for investment purposes payments. Changes in the
In 2007, accounts receivable was 3,429,120 thousand rubles, of legislation with regard to
increased by 4,150,351 thousand which 2,228,161 thousand rubles calculation and payment of the
rubles, including advances issued, are long-term and 1,200,959 water tax and advance tax
by 3,610,669 thousand rubles, and thousand rubles are short-term. payments resulted in an increase
other debtors, by 474,907 Likewise, due to the change in in budget arrears to JSC “OGK-6”,
thousand rubles The increase in payment conditions for gas which in turn led to an increase in
advances issued is due to supply contracts, the amount of the other debtors item. The
advance payments made under advance payments increased increase in arrears for purchasers
contracts for realization of major from 30% to 50%, resulting in a of electric power is due to a
investment projects of JSC “OGK- 136,978 thousand-ruble increase change in the payment schedule.
31.12.2006 | 31.12.2007 | 2007/2006
thousand rubles % thousand rubles % %
BY PERIOD OF OCCURRENCE:
Long-term accounts receivable 501,768 22.49 2,626,988 41.17 523.5%
Short-term accounts receivable 1,729,448 77.51 3,754,579 58.83 217.1%
TOTAL: 2,231,216 100.00 6,381,567 100.00 286.0%
BY LINE:
Purchasers and customers 1,008,963 45.22 1,073,738 16.83 106.4%
Advances issued 367,559 16.47 3,978,228 62.34 1082.3%
Other debtors 854,694 38.31 1,329,601 20.84 155.6%
ИТОГО: 2,231,216 100 6,381,567 100 286.0%
LIABILITIES or 79.69% are capital and liabilities), and 3,095,938
Total liabilities for JSC “OGK-6” reserves, 5,793,570 thousand thousand rubles or 7.07% are
amount to 43,776,391 rubles or 13.23% are short- short-term liabilities (loans and
thousand rubles, of which term liabilities (loans and credits credits comprise 2.2% of short-
34,886,883 thousand rubles comprise 86.3% of long-term term liabilities).
31.12.2006 | 31.12.2007 | 2007/2006
thousand rubles % thousand rubles % %
CAPITAL AND RESERVES 12,711,250 54.44% 34,886,883 79.69% 274.5%
LONG-TERM OBLIGATIONS
— Reserves
Loans and credits 2,503,596 15.67% 5,000,000 13.23% 199.7%
Other 1,155,568 793,570 68.7%
— Short-term financial investments
SHORT-TERM OBLIGATIONS
— Other (VAT and other current assets)
Loans and credits 4,011,745 29.89% 69,301 7.07% 1.7%
Accounts payable 2,767,258 2,750,280 99.4%
— Accounts receivable
Other 200,296 276,357 138.0%
— Montetary funds
BALANCE CURRENCY 23,349,713 100% 43,776,391 100% 187.5%
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
In 2006, the liability structure contained a significant share (29.89%) of short- On 12.29.200,7 the Company completed placement by open subscription of
term obligations. The greater part of the short-term obligations consisted of an additional ordinary share issue with a nominal value of 0.48 rubles (48
loans and credits. In 2007, the company restructured its credit portfolio kopeks) each. The total number of actually placed shares was 5,531,497,444
through replacement of short-term credits with long-term credits, resulting in items, with an placement price of 3.80 rubles per share. As a result of the
a reduction of the share of short-term obligations in the liability structure to additional issue, the Company’s authorized share capital increased from
7.07% as of the end of the year. 12,830,909.52 thousand rubles to 15,486,028.29 thousand rubles. Added
capital increased from 3,807,820 thousand rubles to 22,170,905 thousand
Long-term liabilities consist of a bonded loan of JSC “OGK-6” issued in April rubles. The share of capital and reserves in the liability structure increased from
2007 in the amount of 5,000,000 thousand rubles with a 2012 maturity date 54.44% in 2006 to 79.69% in 2007.
and an interest rate of 7.55%, and of other long-term liabilities in the amount of
793570 thousand rubles – tax and fee arrears under court examination
(533,313 thousand rubles) and deferred tax liabilities (240,254 thousand rubles). ACCOUNTS PAYABLE
Due to reorganization through annexation of JSC power plants, a previous loss (excluding credit and loan accounts)
in the amount of 18,568,534 thousand rubles was received in the Total accounts payable for JSC “OGK-6” as of the end of 2007 are 3,561,714
Company’s accounting balance for 2006, due to which the value of net assets thousand rubles, of which long-term accounts amount to 553,313
as of the end of 2006 was 12,718,134 thousand rubles. At the same time, the thousand rubles (15.54%) and short-term accounts to 3,008,401 thousand
amount of authorized share capital was 26,731,061 thousand rubles. rubles (84.46%). The bulk of accounts payable consists of liabilities to
suppliers and contractors of 2,026,295 thousand rubles (56.89%), tax and
The reduction in the value of the Company’s net assets was due to fee liabilities of 950,998 thousand rubles (26.7%), and liabilities to other
replacement of the value of shares of annexed companies appraised at market creditors of 584,421 thousand rubles (16.41%), of which 258,089 thousand
value with the value of the property of the annexed companies, appraised at rubles (7.25%) comprise liabilities to shareholders for payment of revenue.
book (below market) value in the Company’s accounting balance.
Total accounts payable of JSC “OGK-6” for 2007 decreased by 325,779
Due to the fact that at the end of 2006 the value of the Company’s net assets thousand rubles. Accounts payable increased only for the suppliers and
became less than the amount of authorized share capital, in 2007, the contractors item: this growth was due to the supply of equipment in
Company reduced authorized share capital to an amount not exceeding the December of 2007 with payment due in 2008 as per contract.
value of net assets: 12,830,910 thousand rubles (the value of net assets as of
06.30.2007 was 13,780,117 thousand rubles).
ACCOUNTS PAYABLE
31.12.2006 | 31.12.2007 | 2007/2006
thousand rubles % thousand rubles % %
BY PERIOD OF OCCURRENCE
Long-term accounts payable 925,592 23.81 553,313 15.54 59.8%
Short-term accounts payable 2,961,901 76.19 3,008,401 84.46 101.6%
TOTAL: 3,887,493 100 3,561,714 100 91.6%
BY LINE
Suppliers and contractors 1,946,270 50.06 2,026,295 56.89 104.1%
Tax and fee liabilities 1,398,595 35.98 950,998 26.70 68.0%
Other creditors 542,628 13.96 584,421 16.41 107.7%
TOTAL: 3,887,493 100 3,561,714 100 91.6%
LOANS AND CREDITS
The credit portfolio of JSC “OGK-6” as of 12.31.2007 consisted of a bond loan of 5,000,000 thousand rubles. Short-term credit liability is settled by
funds received from placement of an additional share issue.
INDEX 31.12.06 31.12.07
thousand rubles thousand rubles
Long-term credits and loans without interest arrears 2,500,000 5,000,000
Short-term credits and loans without interest arrears 3,991,100 –
TOTAL: 6,491,100 5,000,000
| ECONOMY
58 | 59
BALANCE STRUCTURE reserves increased from 54.44% to of the long-term investment
As of 12.31.2007, noncurrent 79.69% and the share of short- program, and investment of funds
assets, as at the beginning of the term obligations decreased from received from placement of an
year, occupied the largest share in 29.89% to 7.07% as a result of additional share issue in short-
the assets balance, although their placement of an additional share term deposits, the share of current
share decreased from 75.77% to issue. Due to payment of assets increased from 24.23% to
61.61%. The share of capital and advances on investment projects 38.39%.
2006 | 2007
thousand rubles % thousand rubles %
ASSETS
Noncurrent assets 17,691,825 75.77 26,971,216 61.61
Current assets 5,657,888 24.23 16,805,175 38.39
TOTAL 23,349,713 100 43,776,391 100
LIABILITIES
Capital and reserves 12,711,250 54.44 34,886,883 79.69
Long-term obligations 3,659,164 15.67 5,793,570 13.23
Short-term obligations 6,979,299 29.89 3,095,938 7.07
TOTAL 23,349,713 100 43,776,391 100
ASSETS 2006, 2007 100
— Noncurrent assets
24.23% 38.39% — Current assets
75.77% 61.61%
0
2006 2007
LIABILITIES 2006, 2007 100 29.89% 38.39% — Capital and reserves
61.61% — Long-term obligations
— Short-term obligation
15.67%
54.44% 79.69%
0
2006 2007
Taipei 101
IN 2007, THE VOLUME OF ELECTRIC ENERGY SOLD REACHED 39 BLN KWH.
THIS ENERGY IS ENOUGH TO OPERATE TAIPEI 101, THE WORLD’S LARGEST
BUSINESS CENTER, FOR 450 YEARS.
| ANNUAL REPORT
| 2007
| JSC “OGK-6”
60 | 61
5 SALES OF ELECTRIC POWER
AND HEAT
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
5. ELECTRIC POWER
AND HEAT SALES
I. INFORMATION ON THE ELECTRIC 1.1 ELECTRIC POWER (OUTPUT) TRADE AT REGULATED PRICES
POWER MARKET STRUCTURE (RATES) on the basis of regulated electric power and output purchase
and sale contracts — the regulated contract (RC) market.
The primary market for sales of the products of the Company’s
subsidiaries is the wholesale electric power (output) market. The regulated contract (RC) market functions based on the following
principles:
The wholesale electric power and output market (hereinafter called the
market or WPM) is the placement chain for a particular product: electric » Two products are sold (purchased) as per regulated contracts
power in the context of the Unified Energy System of Russia. Wholesale concluded: electric power and output.
market participants are major producers and purchasers of electric » The supplier is obligated to supply the contracted volume of electric
power that have obtained the status of wholesale market entities and power (output) or (for electric power only) to purchase the same on
act on the basis of the wholesale market rules. the market at competitive prices on the day-ahead market or
through free bilateral contracts. The purchaser is obligated to pay for
The wholesale electric power and output market consists of a system of the contracted volume independent of the amount of their own
contract relations among the totality of its participants/entities, which consumption.
are interconnected by a unified process of the generation, transmission, » The price for electric power and output according to each regulated
placement, and consumption of electric power in the Unified Energy contract is established as being equal to the supplier’s rates for
System of Russia (UES of Russia). Wholesale market entities are electric power and output.
companies conducting purchase and sale of electric power (output) » All RC payments are made through the Non-banking Credit
and/or providing infrastructure services on the wholesale market (system Company RTS Settlement Chamber.
operator JSC SO-CDU UES and the federal network company JSC FSK
UES). Responsibility for purchase and sale of electric power on the Subsequently, this market segment will diminish annually due to
wholesale market is borne by the Noncommercial Partnership Trade increased volumes of electric power supplied as per free long-term
System Administrator of the Wholesale Electric Power Market, NP ATS, contracts, and of the competitive market (liberalization of the electric
established in accordance with the Federal Law “On the Electric Power power market).
Industry”. The settlement system between WES participants is supported
by a clearing company established by NP ATS – ZAO Financial Accounts
Center. In 2007, in accordance with the new wholesale electric power
and output market rules effective as of September 1, 2006 (NWEPM)
(Order №529 of the Government of the Russian Federation dated August
31, 2006), trade in electric power and output on the wholesale market
was conducted using the following mechanisms:
| SALES OF ELECTRIC POWER AND HEAT
62 | 63
1.2. TRADE OF ELECTRIC POWER (OUTPUT) AT FREE (NON- 1. 3. TRADE OF ELECTRIC POWER AT FREE (NON-REGULATED)
REGULATED) PRICES, determined through competitive selection of bids PRICES DETERMINED BY COMPETITIVE SELECTION of bids of
by purchasers and suppliers, is conducted twenty-four hours before suppliers and participants with regulated consumption, conducted not
commencement of supply — the day-ahead market (DAM). later than one hour prior to supply of the electric power for the purposes
of forming a balanced electric power generation and consumption
The primary day-ahead market is the competitive bid selection schedule — the balancing market (BM).
conducted by NP ATS twenty-four hours before, with determination of
hourly fixed-ratio nodal prices and supply (purchase) volumes. This is the market on which bids for current generation or consumption
are traded one hour before actual generation (consumption). The
On the DAM and in free bilateral contracts (FBC), the sale (purchase) of differences in actual generation/consumption volumes from those
electric power is conducted on the following principles: planned as per the results of DAM trading are tendered.
» “Surplus volumes of electric power as per RCs are sold, and missing
volumes needed to fulfill RC obligations are bought ;
» In order to participate in the DAM and ensure ulfillment of
obligations under RCs and FBCs concluded, participants tender all
the volumes of electric power that they plan to generate (purchase)
at each hour of the following day. On the basis of the results of the
competitive bidding for the day ahead, the System Operator plans
the electric power schedules and operating schedules of suppliers
and purchasers of electric power.
GROWTH RATES OF ELECTRIC POWER SALES AT NON-REGULATED STATE PRICES
IN ACCORDANCE WITH THE RESOLUTION OF THE RF GOVERNMENT DATED 11.30.2006
100
5% 10% 15% 25% 30% 50% 60% 80% 100%
0
01.01.07 01.07.07 01.01.08 01.07.08 01.01.09 01.07.09 01.01.10 01.07.10 01.01.11
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
II. SYSTEM OF AGREEMENTS OF THE COMPANY IN III. ELECTRIC POWER SUPPLY
THE WHOLESALE ELECTRICITY AND ELECTRICITY TO THE WHOLESALE AND REGIONAL MARKET
CAPACITY MARKET
3.1. PHYSICAL INDICATORS
Between January 1, 2007, and December 31, 2007, the Company
concluded 397 regulated electricity and electricity capacity purchase The total volume of electric power sales for 2007 was 38,989 million kWh,
and sale agreements with 103 contracting parties. including 38,011 million kWh (of which 31 058 million kWh was in-
house electric power) sold on the wholesale market and 978 million kWh
Sale of electric power on competitive market sectors (DAM and BM) is on the regional market. Total sales volumes of in-house electric power on
conducted as per two commission contracts, and purchase — as per the wholesale market in 2007 increased by 1 138 million kWh (or 3.8%)
two purchase and sale contracts. These contracts are concluded with a compared to 2006. Sales volumes on the retail market remained at
unified party — ZAO CFR. practically the same level.
Payment for services to infrastructure companies of the wholesale On the wholesale electric power (output) market sales of both in-house
market — NP ATS and JSC SO-CDU UES — are confirmed by Orders of (generated) electric power and purchased electric power are conducted
the FTS of Russia; payment for the comprehensive services of ZAO CFR is on the day-ahead market and the balancing market.
confirmed by the NP ATS Supervisory Board.
The procedure for calculating the amount of payment for services of NP
ATS and ZAO CFR, as well as the procedure for paying for these services,
is established by provisions of the current contract of accession of JSC
“OGK-6” to the wholesale market trade system.
The procedure for calculating the amount of payment for services and
the procedure for paying for services of JSC SO-CDU UES are established
by provisions of the current contract for paid rendering of operational-
dispatching services in the electric power industry concluded by JSC SO-
CDU UES with JSC “OGK-6”.
NAME OF CONTRACTING PARTY SHARE IN TOTAL RC VOLUME JSC “OGK-6” LARGEST
CONTRACTING PARTIES
JSC Mosenergosbyt 16.0%
JSC Krasnoyarskenergosbyt 8.9%
JSC Petersburg Sales Company 7.5%
JSC Kolskaya Energy Sales Company 7.4%
JSC Vologodskaya Sales Company 6.2%
JSC Kuzbasskaya Energy Sales Company 6.0%
JSC Belgorodskaya Sales Company 5.6%
Limited Liability Company Donenergosbyt 3.4%
JSC Voronezhskaya Energy Sales Company 3.4%
JSC Karelskaya Energy Sales Company 3.2%
| SALES OF ELECTRIC POWER AND HEAT
64 | 65
ELECTRIC POWER SALES ON THE WHOLESALE AND RETAIL MARKETS FOR 2006–2007, MILLION KWH
PLANT NAME | ELECTRIC POWER SALES, 2006 | ELECTRIC POWER SALES, 2007
TOTAL ON THE WHOLESALE MARKET ON THE RETAIL MARKET TOTAL ON THE WHOLESALE MARKET ON THE RETAIL MARKET
Ryazanskaya GRES 7,758 7,755 3 8,915 8,913 2
Novocherkasskaya GRES 8,773 8,773 – 9,888 9,888 –
Kirishskaya GRES 7,660 6,731 929 8,779 7,805 974
Krasnoyarskaya GRES-2 3,736 3,736 – 5,868 5,868 –
Cherepovetskaya GRES 3,120 3,120 – 3,564 3,564 –
GRES-24 1,725 1,724 1 1,975 1,973 2
TOTAL FOR OGK-6 32,771 31,838 933 38,989 38,011 978
ACTUAL STRUCTURE OF ELECTRIC POWER SALES BY JSC “OGK-6” PLANTS ON THE WHOLESALE MARKET FOR 2006–2007, MILLION KWH
PLANT NAME | ELECTRIC POWER SALES, 2006 | ELECTRIC POWER SALES, 2007
TOTAL IN-HOUSE EP PURCHASED EP* TOTAL EP SALES IN-HOUSE EP PURCHASED EP
Ryazanskaya GRES 7,755 7,374 381 8,913 7,839 1,074
Novocherkasskaya GRES 8,773 8,559 214 9,888 8,834 1,054
Kirishskaya GRES 6,731 5,954 776 7,805 5,251 2,555
Krasnoyarskaya GRES-2 3,736 3,358 378 5,868 4,242 1,626
Cherepovetskaya GRES 3,120 3,012 108 3,564 3,155 409
GRES-24 1,724 1,662 62 1,973 1,738 235
TOTAL FOR OGK-6 31,838 29,920 1,919 38,011 31,058 6,953
* Purchase of electric power as per purchase and sale agreements began September 1, 2006, with the entry into force of the new wholesale electric power and output market rules (NWEPM), approved by order
#529 of the Government of the Russian Federation dated August 31, 2006. Prior to this, only electric power sales were conducted on the wholesale market.
STRUCTURE OF ELECTRIC POWER
SALES FOR 2006–2007
6% 94% 18% 82%
— PURCHASED EL. POWER
— OWNED EL. POWER
2006 2007
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
ELECTRIC POWER SALES STRUCTURE
ON THE WHOLESALE MARKET BY SECTOR
5% 85% 5% 80% FOR 2006–2007
10% 15%
— RC
— DAM
— BM
2006 2007
VOLUMES OF ELECTRIC POWER SALES ON THE WHOLESALE MARKET BY SECTOR FOR 2006–2007, MILLION KWH
PLANT NAME | 2006 | 2007
TOTAL EP SALES RS/RC FTS/DAM DS/BM TOTAL EP SALES RC DAM BM
Ryazanskaya GRES 7,755 6,485 854 416 8,913 7,036 1,361 516
Novocherkasskaya GRES 8,773 7,569 1,012 192 9,888 8,645 1,090 153
Kirishskaya GRES 6,731 5,931 209 590 7,805 6,272 812 721
Krasnoyarskaya GRES-2 3,736 3,423 211 101 5,868 4,762 958 148
Cherepovetskaya GRES 3,120 2,352 528 240 3,564 2,382 921 261
GRES-24 1,724 1,350 276 98 1,973 1,423 486 64
TOTAL FOR OGK-6 31,838 27,110 3,091 1,637 38,011 30,521 5,628 1,862
Before the new wholesale electric power (output) market began to function (NWEPM, on September 1, 2006), trade in electric power and output was conducted in the regulated sector (RS), the free trade sector (FTS), and the
divergences sector (DS). After the NWEPM was launched, the regulated sector was transformed into a market of bilateral regulated contracts (RC), the free trade sector into a day-ahead market (DAM), and the divergences sector into the
balancing market (BM).
The basic strategy for formulating » price indicators formed on the The specified strategy minimizes
bids for participation in the day- day-ahead market and the forced sale of electric power on
ahead market under NWEPM balanced electric power the DAM at prices below
conditions in 2007 considers both market; conventional costs and takes into
the technical and technological » plant operating schedule; account the economic efficiency
specifics of each plant, » forecast of regional electric of sales of in-house or purchased
competitiveness of the plants, power consumption; electric power (whether or not it is
volumes of electric power » planned fuel costs; more profitable to generate in-
supplied as per regulated » system limitations influencing house EP or replace in-house
contracts, and the following plant operation; generation with purchased
factors: » repair schedule and forecast of electric power).
operation of competing plants;
» seasonal conditions.
| SALES OF ELECTRIC POWER AND HEAT
66 | 67
ELECTRIC POWER SALES STRUCTURE
BY SECTOR FOR 2006-2007 19% 81%
25% 75%
— DAM
— BM
2006 2007
VOLUMES OF ELECTRIC POWER SALES ON THE WHOLESALE MARKET BY SECTOR FOR 2006–2007, MILLION KWH
PLANT NAME | 2006 | 2007
TOTAL EP SALES FTS/DAM DS/BM TOTAL EP SALES DAM BM
Ryazanskaya GRES 381 241 140 1,074 637 438
Novocherkasskaya GRES 214 167 47 1,054 897 157
Kirishskaya GRES 776 574 203 2,555 2,230 324
Krasnoyarskaya GRES-2 378 367 11 1,626 1,501 126
Cherepovetskaya GRES 108 65 42 409 231 178
GRES-24 62 34 28 235 131 103
TOTAL FOR OGK-6 1,919 1,448 470 6,953 5,626 1,326
Purchasing of electric power as per purchase and sale agreements began September 1, 2006 with the entry into force of the new wholesale electricity and electricity capacity market rules (NWEPM), approved by
order №529 of the Government of the Russian Federation dated August 31, 2006. Prior to this, only electric power sales were conducted on the wholesale market.
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
3.2. PRICE INDEXES Rates for production of electric
power are established annually by
order of the FTS on the basis of
Order №109 of the RF
Government “Concerning price
setting in relation to electrical and
heat in the RF”.
DYNAMICS OF RATE CHANGES FOR ELECTRICITY AND ELECTRICITY CAPACITY
NAME OF POWER PLANT | 2006 | 2007 | 2008*
BASE RATE BASE RATE BASE RATE BASE RATE BASE RATE BASE RATE FOR OUTPUT, THERMAL OUTPUT,
FOR EP, TEP FOR OUTPUT, FOR EP, TEP FOR OUTPUT, FOR EP, TEP
THERMAL OUTPUT THERMAL OUTPUT AVERAGE JANUARY – JUNE JULY – DECEMBER
rub./MWhr rub./MWhr per mo. rub./MWhr rub./MWhr per mo. rub./MWhr rub./MWhr per mo. rub./MWhr per mo. rub./MWhr per mo.
Ryazanskaya GRES 585.52 72,889.66 606.69 78,972.44 679.97 83,088.41 78,136.44 88,040.38
Novocherkasskaya GRES 524.94 100,470.68 556.38 99,959.15 621.56 108,559.17 102,089.17 115,029.17
Kirishskaya GRES 619.63 65,210.70 781.19 74,568.28 822.31 81,235.10 76,393.58 86,076.62
Krasnoyarskaya GRES-2 324.38 91,832.36 304.17 108,381.93 313.06 116,681.09 109,727.03 123,635.15
Cherepovetskaya GRES 538.90 97,607.26 547.83 120,776.64 635.51 129,681.72 121,952.84 137,410.60
GRES-24 484.20 129,908.53 484.25 144,676.70 621.30 156,930.34 147,577.47 166,283.20
* Rates for 2008 are established by order № 535-e/2 of FTS of Russia dated December 25, 2007, “On rates for electric power (output) sold on the wholesale market by contract in the context of extreme (minimum and maximum) sales
volumes of electric power (output) at regulated prices (rates)”.
The table below presents the average delivery prices for electric power inclusive of output, average delivery
prices for electric power exclusive of output, and prices for sale and purchase of electric power (output)
individually by wholesale market sector.
ACTUAL AVERAGE DELIVERY PRICES* BY WHOLESALE MARKET SECTOR FOR 2007, RUB./MWH
PLANT NAME | 2006 | REGULATED CONTRACTS | DAY-AHEAD MARKET | BALANCING MARKET
PRICE OF EP INCLUSIVE ACTUAL AVERAGE OUTPUT WITH ALLOWANCE WITH ALLOWANCE
OF OUTPUT FOR THE TRANSFER PRICE WITH ALLOWANCE FOR VALUE ADJUSTMENTS FOR VALUE ADJUSTMENTS
WHOLESALE OF EP FOR THE FOR VALUE ADJUSTMENTS
MARKET WHOLESALE
OVERALL MARKET EP SALE PURCHASE** SALE PURCHASE SALE PURCHASE
Ryazanskaya GRES 955 641 607 78,650 1 718 517 623 494
Novocherkasskaya GRES 852 571 556 99,550 55,704 619 514 558 433
Kirishskaya GRES 1,194 876 781 74,265 75,784 689 554 799 618
Krasnoyarskaya GRES-2 732 358 304 108,144 94,595 388 169 251 681
Cherepovetskaya GRES 865 584 548 120,279 80,672 655 524 582 544
GRES-24 844 539 484 144,086 12,433 633 468 547 325
* Prices are the average weighted prices for sale (purchase) of electric power (output) calculated as the cost of the sale (purchase) of EP (output) divided by the respective volumes. Moreover, the actual cost is indicated, i.e., includes
both the direct cost of the sale (purchase) of EP (output) as per bidding results and cost adjustment. Cost adjustment on the DAM is made in accordance with par. 80 of Order №529 of the RF Government “On improving the procedure
for the functioning of the wholesale electric power (output) market”. Cost adjustment on the BM is in accordance with par. 9.1 of the Regulation for determining volumes, initiatives, and cost divergence.
** Purchase of output occurs in the event of actual maximum consumption exceeding the normative maximum consumption in accordance with par. 2.2 of the Regulation for determining the values of differences in actual obligations
from planned obligations for purchase of output.
| SALES OF ELECTRIC POWER AND HEAT
68 | 69
3.3. VALUE
INDICATORS
ACTUAL VALUE OF ELECTRICITY AND ELECTRICITY CAPACITY SALES ON THE WHOLESALE MARKET FOR 2006, MILLION RUB. (EXCLUDING VAT)
PLANT NAME RS/RC* FTS/DAM* DS/BM* TOTAL
EP OUTPUT EP EP VALUE OF EP AND OUTPUT SALES
Ryazanskaya GRES 3,797 2,082 481 338 6,699
Novocherkasskaya GRES 3,973 2,292 549 143 6,956
Kirishskaya GRES 3,675 1,478 120 577 5,849
Krasnoyarskaya GRES-2 1,110 1,332 68 28 2,538
Cherepovetskaya GRES 1,267 664 285 159 2,376
GRES-24 654 430 157 78 1,318
TOTAL FOR OGK-6 14,477 8,277 1,659 1,322 25,736
* Before the new wholesale electric power (output) market began to function (NWEPM, on September 1, 2006), trade in electric power and output was conducted in the regulated sector (RC), the free trade sector (FTS), and the
divergences sector (DS). After the NWEPM was launched, the regulated sector was transformed into a market of bilateral regulated contracts (RC), the free trade sector into a day-ahead market (DAM), and the divergences sector into
the balancing market (BM).
ACTUAL VALUE OF ELECTRICITY AND ELECTRICITY CAPACITY SALES ON THE WHOLESALE MARKET FOR 2007, MILLION RUB. (EXCLUDING VAT)
PLANT NAME RS/RC* FTS/DAM* DS/BM* TOTAL
EP OUTPUT EP EP VALUE OF EP AND OUTPUT SALES
Ryazanskaya GRES 4,269 2,467 977 321 8,035
Novocherkasskaya GRES 4,810 2,486 675 85 8,056
Kirishskaya GRES 4,899 1,837 560 576 7,872
Krasnoyarskaya GRES-2 1,449 1,603 371 37 3,461
Cherepovetskaya GRES 1,305 898 603 152 2,958
GRES-24 689 530 308 35 1,562
TOTAL FOR OGK-6 17,422 9,822 3,494 1,206 31,944
4% 31%
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
STRUCTURE OF EARNINGS FROM ELECTRICITY
AND ELECTRICITY CAPACITY SALES ON THE
WHOLESALE MARKET FOR 2006–2007
5% 32% 4%
6% 11% 31%
57%
— RC (output)
54%
— RC (el. power)
— DAM (el. power)
— BM (el. power)
2006 2007
3.4. OPERATING EFFICIENCY ON THE WHOLESALE MARKET As a result, in the first quarter of 2006 under low DAM pricing conditions
the strategy was primarily directed towards replacement of in-house
Since the approval of the new wholesale electric power and output generation with electric power purchased on the wholesale market to
market rules, new opportunities for earning additional income ensure RC volumes. For subsidiaries GRES-24 and Cherepovetskaya GRES,
depending on the chosen wholesale market operating strategy have where the System Operator increased generation beyond planned
appeared. indicators, the strategy was based on obtaining maximum profit from
the sale of electric power at free prices.
Several base models were developed in the Company for behavior on
the competitive market, depending on various external conditions and In the second half of 2007, under conditions of significant price increases
the composition of equipment selected by the System Operator to on the wholesale market, the strategy for wholesale market participation
operate at the plants. was changed for JSC “OGK-6” plants with consideration of the economic
expediency of increasing electric power sales on the DAM.
In addition, the effectiveness of the selected strategy is analyzed daily in
JSC “OGK-6” and promptly adjusted for the results of an appraisal of the Thus, in 2007, as a result of the effectiveness of the applied strategy, the
following information: Company obtained additional income from selling electric power on the
» results of plant participation on the wholesale market for previous wholesale market at prices higher than the electric power rates
periods; confirmed by FTS of Russia, in the amount of 1,327, million rubles
» values of the planned fuel factor in the production cost of electric exclusive of VAT.
power, calculated using a software system;
» allowance for the requirements of the antimonopoly system;
» elasticity of supply and demand on the wholesale market.
| SALES OF ELECTRIC POWER AND HEAT
70 | 71
5% 5%
9% 9%
— RGRES
10% 26% 11% 25%
— NchGRES
— KiGRES
— KGRES-2
27% 25% 25%
— ChGRES 23%
— GRES-24
2006 2007
ADDITIONAL INCOME FROM THE SALE OF ELECTRIC POWER ON THE WHOLESALE MARKET
IN COMPARISON WITH ELECTRIC POWER RATES CONFIRMED BY FTS OF RUSSIA FOR 2007
PLANT NAME |
ACTUAL ELECTRIC POWER SALES ON THE WHOLESALE MARKET
VOLUME OF IN-HOUSE EP AVERAGE WEIGHTED PRICE VALUE EP RATE COST ADDITIONAL INCOME ADDITIONAL INCOME
CONF. BY FTS OF SUPPLY FOR TEP FROM REALIZATION FROM REALIZATION
OF EP ON THE WPM (EXC. VAT) OF EP ON THE WPM (EXC. VAT)
million kWh rub./MWh million rub. rub./MWh млн. руб. million rub. million rub.
1 2 3=4/2 4 5 6=2*5 7=4–6 8 = 7 * VAT
Ryazanskaya GRES 7,839 640.74 5,022 606.69 4,756 267 315
Novocherkasskaya GRES 8,834 570.61 5,041 556.38 4,915 126 148
Kirishskaya GRES 5,251 875.93 4,599 781.19 4,102 497 587
Krasnoyarskaya GRES-2 4,242 357.91 1,518 304.17 1,290 228 269
Cherepovetskaya GRES 3,155 583.91 1,842 547.83 1,728 114 134
GRES-24 1,738 538.94 937 484.25 842 95 112
TOTAL FOR OGK-6 31,058 18,960 17,633 1,327 1,566
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
IV. HEAT SUPPLY
The primary line of activity of In the course of 2007, as per heat
subsidiaries on the heat market is supply agreements, JSC “OGK-6”
the supply of heat to businesses subsidiaries supplied 4,165.5 VOLUME OF PRODUCTIVE SUPPLY OF
and the housing and utilities thousand Gcal of heat. All THERMAL POWER BY OPEN JOINT-STOCK
sector (HUS). In addition, it should contract obligations were met in COMPANY OGK-6 ELECTRIC POWER PLANTS
be noted that Novocherkasskaya accordance with the contract FOR 2006, GCAL
GRES, Cherepovetskaya GRES, and conditions, without disruptions in
Ryazanskaya GRES direct over 85% the supply schedule or the heat
of heat to HUS consumers. transfer medium.
Subsidiaries sell heat through
three types of agreements:
» supply of hot water for
heating;
» supply of hot water for
domestic needs;
» supply of heat in the form of
steam for process needs of
businesses.
USABLE SUPPLY AND STRUCTURE OF HEAT CONSUMERS IN 2006–2007, IN THOUSAND GCAL
PLANT NAME | 2006 | 2007
HEAT SHARE OF HUS SHARE OF INDUSTRIAL SHARE OF OTHER HEAT SHARE OF HUS SHARE OF INDUSTRIAL SHARE OF OTHER
SUPPLIED BUSINESSES ENTERPRISES CONSUMERS SUPPLIED BUSINESSES ENTERPRISES CONSUMERS
Gcal/yr % % % Gcal/yr % % %
Ryazanskaya GRES 231.7 92.48 – 47.52 186.0 3.06 – 16.94
Novocherkasskaya GRES 115.2 2.72 5.1 2.18 93.6 1.88 6.83 1.29
Kirishskaya GRES 2,705.5 20.43 76.15 3.42 2,632.5 20.02 76.99 -2.99
Krasnoyarskaya GRES-2 1,262.8 8.85 0.26 0.89 1,156.3 9.43 0.43 0.14
Cherepovetskaya GRES 107.1 80.41 7.64 11.95 97.1 78.69 3.09 18.22
TOTAL 4,422.4 52.08 46.29 1.63 4,165.5 47.84 49.0 3.16
| SALES OF ELECTRIC POWER AND HEAT
72 | 73
115.2 93.6
— RGRES 231.7 186.0
107.1 97.1
— NchGRES
— KiGRES
1,262.8 1,156.3
— KGRES-2
— ChGRES
2,705.5 2,632.5
2006 2007
DYNAMICS OF RATE CHANGE FOR HEAT, IN RUB./GCAL
PLANT NAME | 2006* 2007* 2008**
Ryazanskaya GRES 208.67 306.54 424.24
Novocherkasskaya GRES 451.60 480.01 571.06
Kirishskaya GRES 497.49 505.55 550.82
Krasnoyarskaya GRES-2 268.00 292.68 315.31
Cherepovetskaya GRES 420.43 450.74 519.80
TOTAL FOR OGK-6 415.42 431.75 476.55
* Actual average rates.
** Rates for 2008 are confirmed by orders of the REC and averaged by consumer group.
Formula 1
THE COMBINATION OF SEVERAL KEY FACTORS IS NEEDED TO WIN
FORMULA-1: EXCEPTIONAL PERFORMANCE OF A BOLIDE, PROFESSIONAL
PILOTS, EFFICIENT TEAMWORK OF PERSONNEL, AND THE RIGHT RACE
STRATEGY. THESE FACTORS ARE CHARACTERISTIC OF OUR COMPANY
AND WILL FACILITATE ITS CAPITALIZATION.
| ANNUAL REPORT
| 2007
| JSC “OGK-6”
74 | 75
6 SECURITIES
AND SHARE CAPITAL
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
6. SECURITIES
AND SHARE CAPITAL
I. STRUCTURE OF COMPANY
SHARE CAPITAL
1.08%
As of 12.31.2007, the Company’s The Russian Federation owns no CHANGES IN THE STRUCTURE 5.44%
authorized share capital amounted shares in JSC “OGK-6”. Subjects of OF SHARE CAPITAL FOR 2007
to 15,486,028,289.2 rubles and the Russian Federation own 662 On 12.29.2007, the placement of
was divided into 32,262,558,936 shares (0.00000205%). Vologda an additional share issue of JSC
ordinary registered shares with a Region, represented by the “OGK-6” by open subscription was
par value of 0.48 rubles (48 Vologda Region Department of completed (state registration
kopeks) each. The Company did Property Relations, owns 221 number 1-02-65106-D-001D dated
not issue any preferred shares. shares (0.000000685%). Moscow 09.18.2007). The total number of
Region, represented by the actually placed shares was
As of 12.31.2007, 19,995 entities Moscow Region Ministry of 5,531,497,444, including 93.48%
were registered in the JSC “OGK-6” Property Relations, owns 441 5,526,000,000 shares acquired by
register, of which 19,883 were private shares (0.000001366%). ZAO Gazenergoprom-Invest.
individuals, 89 were legal entities, and With the exception of JSC RAO UES Changes in the Company Articles
23 were nominee holders. The of Russia and ZAO of Association on increasing 31.12.2006
Company’ s principal shareholders are Gazenergoprom-Invest, no authorized capital stock were
JSC RAO UES of Russia, which owns shareholders own five or more registered by the FTS Inspectorate
77.45% of the authorized share percent of the authorized share for Leninsky District, Rostov-on- 0.73%
capital (24,988,320,973 shares) and capital. Don on February 21, 2008. 4.69%
ZAO Gazenergoprom-Invest, which
owns 17.13% of the authorized share
capital (5,526,000,000 shares). 17.13%
Minority shareholders own 5.42% of
the Company’s authorized share
capital.
77.45%
SHAREHOLDERS NUMBER OF SHARES
items %
Private individual 234,310,553 0.726%
Legal entities 4,638,901 0.014% 31.12.2007
Nominee holders 32,023,525,418 99.259%
Personal account of issuer 84,064 <0.001%
TOTAL SHARES 32,262,558,936 100.000% — JSC RAO UES of Russia
— Other physical entities and nominee holders
— Physical entities
— ZAO Gazenergoprom-Invest
| SECURITIES AND SHARE CAPITAL
76 | 77
II. INFORMATION ON THE COMPANY’S ISSUE OF
SECURITIES AND RESULTS OF TRADING SECURITIES
STRUCTURE OF JSC “OGK-6” REORGANIZATION SHARES Additional share issue
SHARE EQUITY UPON CONCLUSION OF JSC “OGK-6” IN 2008 Two share issues were registered placed by open subscription
OF REORGANIZATION IN JULY OF 2008 09.11.2007 Внеочередное общее with the Company in 2007. On September 28, 2007, FFMS of
On 9.11.2007 an Extraordinary Russia registered an additional
General Shareholders’ Meeting Share issue placed through share issue, state registration
decided to reorganize JSC “OGK-6” share conversion number 1-02-65106-D-001D
by annexing JSC “OGK-6” Holding, In May 2007, the Federal Financial (decision to issue and prospectus),
which was created by separating it Market Service registered an issue of placed by open subscription.
from JSC RAO UES of Russia. The JSC “OGK-6” shares and a prospectus
17.13% proposed date for conclusion of of securities having a lesser par value On December 12, 2007 the
42.91%
the reorganization is July 1, 2008. for the purposes of converting JSC Company published an invitation
JSC “OGK-6” shares belonging to “OGK-6” shares to the latter (state for proposals/offers to acquire the
5.42% JSC RAO UES of Russia will be registration number 1-02-65106-D) additional share issue. Offers were
9.60% distributed among shareholders of of the same category/type. Share received by the broker from
JSC RAO UES of Russia. placement by conversion occurred December 12 to 17, 2007 (four
on 05.22.2007. On June 7, 2007, business days).
In accordance with the separation FFMS of Russia registered a report on
24.94% balance of JSC RAO UES of Russia, the results of the issue, and on June At the end of the bidding the
JSC Centrenergoholding, which is 21, 2007, a change was registered in Board of Directors established the
affiliated with JSC Gazprom, will the Articles of Association of JSC price for placement of the
receive 13,845 million shares of “OGK-6” related to decreasing the additional share issue, including
— JSC Centrenergoholding (JSC Gazprom) JSC “OGK-6” (or 42.91% of the Company’s authorized share capital. shares placed in the process of
authorized share capital) in the As a result of the conversion of JSC exercising preemptive rights, as
— Minority shareholders of JSC RAO UES of Russia context of reorganization, which “OGK-6” shares into shares of the being equal to 3.80 rubles per
with consideration of shares same category/type having a lesser share (protocol #57 dated
— JSC FSK already belonging to affiliated par value, the authorized share 12.19.2007), which corresponded
companies of JSC Gazprom will capital of JSC “OGK-6” decreased to the Company’s capitalization of
— Minority shareholders of JSC OGK-6 enable JSC Gazprom to obtain from 26,731,061,492 rubles to $548 per kW of installed capacity
control of JSC “OGK-6” (more than 12,830,909,516 rubles, an amount (or EV — $590/kW) at the time of
— ZAO Gazenergoprom-Invest (JSC Gazprom) 60% of share capital). not exceeding the value of net placement.
assets (the value of net assets as of
06.30.2007 was 13,780,117 After determining the placement
thousand rubles). price in accordance with the
securities prospectus, the shares
were placed from December 20 to
29, 2007.
The number of actually placed
additionally issued shares was
5,531,497,444 (46.7% of the total
number of registered shares),
including 5,497,444 placed in the
process of exercising preemptive
rights in acquiring shares.
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
III. JSC “OGK-6” SHARES
TRADING RESULTS
Due to conversion of the shares to Between 12.31.2006 and circulation of trades of OGK-6
shares of the same category/type 12.31.2007, 16,162 market shares on MICEX was in the range
having a lesser par value, beginning transactions were completed at of 140-227 million rubles. From
on 05.22.2007, trading in JSC “OGK-6” MICEX involving JSC “OGK-6” July to December 2007, the
converted shares ceased at the shares. Trade volumes amounted monthly trading volume was 15-
MICEX exchange. In JSC RTS, trading to approximately 396 million 115 million rubles. The RTS —
in JSC “OGK-6” shares on the shares, or 1,504 million rubles. Electrical Utilities index, the
exchange market ceased on account of which includes
05.22.2007, and on the classical Between 12.31.2006 and quotations of 16 of the largest
market — on 05.17.2007. In June 12.31.2007, JSC RTS concluded companies in the Russian electric
2007, no JSC “OGK-6” shares were 194 transactions on the classical power industry, increased at year
circulated on the exchange floors. market. Trade volume amounted end by 35.28% from 345.05 points
to 99.2 million shares, or 14.6 on January 9, 2007, to 466.78
Beginning on 07.18.2007, JSC million US dollars. JSC RTS points on December 28, 2007.
“OGK-6” second-issue shares were concluded 53 transactions on the
admitted to trade in quotation list exchange market in 2007. Trade In the same period, the Company’s
“I” of ZAO FB MICEX and in the list volume amounted to 1.03 million capitalization, calculated as the
of securities admitted to trade shares, or 3.85 million rub. total value of all shares issued
without undergoing listing times their market value
procedures of JSC RTS. In 2007, JSC “OGK-6” shares on the (calculated in accordance with
MICEX decreased by 2.78% from Resolution № 03-52/ps of the RF
In accordance with the Provision on 3.349 rubles per share on January Federal Commission for the
organizing trading on the securities 9, 2007 to 3.56 rubles per share on Securities Market dated December
market, on inclusion in quotation list December 28, 2007. On the RTS 24, 2008), increased by 16.6%,
“I” of ZAO MICEX, the Company the price of shares increased by from 89 billion rubles ($372 per
concluded a contract with 10.78% from $0.116 per share on kW of installed capacity) to 103.8
authorized financial consultant JSC January 9, 2007, to $0.1285 per billion rubles $466 per kW of
OTKRITIE Brokerage House, which share on December 25, 2007. The installed capacity). The increase in
was entrusted with supervision of 7.2% drop in the exchange rate of capitalization against the
information disclosure by the the dollar should likewise be borne background of decreasing market
Company and confirmation of the in mind. During the year, the value of shares occurred due to an
reliability and completeness of all MICEX index rose by 20.19%, from increase in the total number of
information contained in quarterly 1571.59 points on January 9, 2007, shares resulting from the
Company reports, with the to 1888.86 points on December 28, additional issue.
exception of the portion approved 2007. The RTS index increased by
by the auditor or appraiser, for the 27.35%, from 1798.63 points on
duration of the entire period during January 9, 2007, to 2290.51 points
which Company shares are in on December 28, 2007.
quoted list “I”.
One of the primary causes of the
In accordance with this same drop in price of JSC “OGK-6” stock
Provision, a contract was against the background of an
concluded with Joint-Stock increase in the share index is the
Commercial Bank Moskovsky reduction of their liquidity upon
Delovoy Mir (an JSC), fulfilling the inclusion in quotation list “I” of
obligations of market maker with ZAO FB MICEX. From January to
regard to JSC “OGK-6” stock May 2007, prior to inclusion in
circulated in quotation list “I”. quotation list “I”, the monthly
| SECURITIES AND SHARE CAPITAL
78 | 79
RESULTS OF TRADING IN JSC “OGK-6” SHARES ON ZAO FB MICEX IN 2007 (PRIMARY TRADING SCHEDULE)
JANUARY FEBRUARY MARCH APRIL MAY JUNE JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER
Number of market transactions, units 1,703 5,004 4,039 1,867 860 0 107 374 353 342 652 861
Trade volume, in million shares 38.89 96. 9 58.5 29.37 57.81 0 4.08 14.25 25.31 8.91 24.45 35.86
Trade volume, in million rubles 139.71 395.77 238.28 121.19 226.66 0 16.44 61.36 84.12 29.04 76.33 114.76
RESULTS OF TRADING JSC “OGK-6” SHARES ON JSC RTS IN 2007 (CLASSICAL MARKET)
JANUARY FEBRUARY MARCH APRIL MAY JUNE JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER
Number of market transactions, units 21 36 30 16 9 0 5 6 8 9 32 22
Trade volume, in million shares 8.82 13.02 11.65 6.13 4.04 0 25.61 2.03 3.58 3.29 12.9 8.11
Trade volume, in million USD. 1.15 1.96 1.82 0.98 0.61 0 4.23 0.29 0.47 0.43 1.66 1.06
OGK-6 CAPITALIZATION AND VALUE IN 2007
DATE | QTY. OF SHARES ISSUED | MARKET PRICE AT MICEX*| CAPITALIZATION | CAPITALIZATION /INSTALLED CAPACITY | NET DEBT | EV**
units rub.* rub. rub./kW $/kW rub. $/kW
09.01.2007 26,731,061,492 3.331 89,041,165,829.80 9,837 372 6,352,396,000 398
28.12.2007 32,262,558,936 3.218 103,820,914,656.00 11,469 466 – 10,505,373,000 418
* Market price calculated in accordance with the Procedure for calculation of the market price of equity securities and investment common shares of mutual funds admitted to circulation by trade institutors
(conf. by resolution #03-52/ps of the RF Federal Commission for the Securities Market dated December 24, 2003).
** EV (Enterprise Value) = Capitalization + Net debt;
Net debt = Long-term borrowed loans and credits + Short-term loans and credits – Monetary funds – Short-term financial investments – Long-term deposits accounted in the composition of Long-term financial investments.
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
PRICE OF JSC OGK-6 SHARES, IN RUB. MICEX INDEX PRICE TRENDS OF JSC “OGK-6” SHARES
4,5 2025 ON MICEX AND THE MICEX INDEX FOR 2007
4,3 1925
4,1
1825
3,9
3,7 1725
3,5 1625
3,3
1525
3,1
1425
2,9
2,7 1325
20 february 5 april 21 may 3 july 14 august 25 september 7 november 19 december
Closing price, in rub. MICEX index
1,5
COMPARATIVE PRICE DYNAMICS
FOR JSC “OGK-6” SHARES AND JSC RTS
1,4 EXCHANGE INDEXES FOR 2007
1,3
1,2
1,1
1,0
0,9
10 march 9 may 8 july 6 september 5 november 5 december
RTS share price RTS — Electrical Utilities index * RTS index
* Electrical Utilities index includes quotations of 16 major Russian electrical industry enterprises
| SECURITIES AND SHARE CAPITAL
80 | 81
DIVIDENDS
In 2007, the decision was made to pay dividends for year end 2006, as well as interim dividends for the end of
the first quarter of 2007 and the end of the first half of 2007 for a total of 717.5 million rubles. Dividends of
224.2 million rubles out of 226 million rubles accrued at the end of 2006 were paid; the remaining unpaid
dividends as of 12.31.2007 amount to 1.8 million rubles. Interim dividends of 228.2 million rubles out of 230
million rubles for the end of the first quarter of 2007 were paid; the remaining unpaid dividends as of
12.31.2007 are 1.8 million rubles. Dividends of 15 million rubles out of 261.5 million rubles accrued for the
end of the first half of 2007 were paid to minority shareholders; the remaining unpaid dividends as of
12.31.2007 due to minority shareholders amount to 2 million rubles, and due to JSC RAO UES of Russia —
244.5 million rubles. Payment arrears of dividends of plants annexed in the process of reorganization of
subsidiaries GRES-24 and Cherepovetskaya GRES by JSC “OGK-6” due to minority shareholders as of 12.31.2007
amount to 7.9 million rubles.
DIVIDENDS ACCRUED FOR 2007: | DISCHARGE STATEMENT
.
AMOUNT PAYMENT SUM
PAID* DUE DATE OF ARREARS
TOTAL: 717.5 467.4 – 250.1
including interim dividends:
– for the end of 2006 226.0 224.2 28.08.2007 1.8
– for the end of the first quarter of 2007 230.0 228.2 28.08.2007 1.8
– for the end of the first halfof 2007 261.5 15.0 26.11.2007 246.5
* including tax on income in the form of dividends
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
BONDS
On March 22, 2007, the Federal Financial Market Service registered issues and a Prospectus of nonconvertible
interest-bearing bonds of JSC “OGK-6” to the bearer of series 01 (state registration number 4-01-65106-D) and
series 02 (state registration number 4-02-65106-D), placed by open subscription.
Series 01 bonds were placed on MICEX on April 26, 2007.
The coupon rate for JSC “OGK-6” series 01 bonds was determined at auction in the placement process and was
7.55% per annum.
On 04.27.2007, bonds were accepted for trade at MICEX in the list of non-listed stock. The MICEX trading system
code of the bonds is RU000A0JP6X0.
On May 31, 2007, the Federal Financial Market Service registered a Report on the result of the securities issue
(series 01 bonds).
On November 15, 2007, JSC “OGK-6” series 01 bonds were included in quotation list “B” of ZAO FB MICEX.
During 2007, 530 transactions involving JSC “OGK-6” series 01 bonds were concluded at MICEX in the primary
trade mode. Bond transaction volume was 2.43 million securities, or 2.40 billion rubles.
PARAMETERS FOR ISSUE OF JSC “OGK-6” SERIES 01 BONDS IN ACCORDANCE WITH THE DECISION TO ISSUE
DATE OF REGISTRATION | | AMORTIZATION | EARLY REDEMPTION
EMISSION VOLUME MATURITY FREQUENCY DATE PRICE DATE PRICE
OF COUPON PAYMENT OF AMORTIZATION OF AMORTIZATION OF EARLY REDEMPTION OF EARLY REDEMPTION
million rubles in years % of par value % of par value
22.03.2007 5 000 5 Twice yearly 19.04.2012 100 29.04.2010 100
| SECURITIES AND SHARE CAPITAL
82 | 83
PAYMENT SCHEDULE COUPON # DATE OF PAYMENT COUPON RATE AMOUNT OF COUPON AMORTIZATION OF PAR VALUE
OF SERIES 01 BOND REVENUES % per annum in rubles in rubles
1 25.10.2007 7.55 37.65 –
2 24.04.2008 7.55 37.65 –
3 23.10.2008 7.55 37.65 –
4 23.04.2009 7.55 37.65 –
5 22.10.2009 7.55 37.65 –
6 22.04.2010 7.55 37.65 –
7 21.10.2010 Determined by the Issuer Determined by the Issuer –
8 21.04.2011 Determined by the Issuer Determined by the Issuer –
9 20.10.2011 Determined by the Issuer Determined by the Issuer –
10 19.04.2012 Determined by the Issuer Determined by the Issuer 1000
JSC “OGK-6” BOND YIELD DYNAMICS 9,8
FOR 2007
9,3
8,8
8,3
7,8
7,3
6,8
28 june 3 august 8 september 14 oktober 19 november 25 december
Yield to put at av. weighted price, % per annum RUX-Cbonds av. weighted yield/eff.
Queen Mary 2
THE CREW OF QUEEN MARY 2, ONE OF THE WORLD’S LARGEST OCEAN LINERS,
SERVES 2,500 PASSENGERS ON BOARD. THE OKG-6 MANAGEMENT TEAM
OPERATES THE COMPANY IN THE INTERESTS OF 25,000 SHAREHOLDERS BASED
ON THE PRINCIPLES OF REPORTING, TRANSPARENCY, AND RESPONSIBILITY.
| ANNUAL REPORT
| 2007
| JSC “OGK-6”
84 | 85
7 CORPORATE GOVERNANCE
STRUCTURES AND PRINCIPLES
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
7. CORPORATE GOVERNANCE
STRUCTURES AND PRINCIPLES
I. PRINCIPLES
AND DOCUMENTS
The Company’s corporate governance is understood to be the aggregate 1. COMPANY ARTICLES OF ASSOCIATION
of processes providing for management and control of its activities and The Articles of Association are the constituent document of the Company.
including relations among shareholders, the Board of Directors, and the The Articles of Association contain information regarding the Company’s
Company’s executive bodies in the interests of the shareholders. The legal status, objectives and forms of activity, authorized share capital, and
Company views corporate governance as a means of increasing the shareholder rights. They likewise contain a description of the Company’s
Company’s productivity, strengthening its reputation, and increasing executive bodies, their competency, and the procedures for their activities.
capitalization.
The current edition of the Articles of Association was approved on 10.28.2006
The Company’s corporate governance is conducted in accordance with by decision of the Board of Directors of JSC RAO UES of Russia, which at the
the Code of Corporate Governance adopted in the company and is based time of approval was performing the functions of the General Shareholders’
on the following principles: Meeting of JSC “OGK-6” and was registered with the Inspectorate of FTS of
Russia for Leninsky District, Rostov-on-Don on 11.17.2005.
» Accountability. The Code stipulates accountability of the Company’s
Board of Directors to all shareholders in accordance with current legislation Changes to this edition of the Articles of Association:
and serves as the guidelines for the Board of Directors in drawing up 1) Amendments to the Articles of Association, registered 06.27.2006
resolutions and overseeing the activity of the Company’s executive bodies. 2) Appendix № 1 to the Articles of Association, registered 07.12.2006
3) Amendments to the Articles of Association, registered 09.29.2006
» Fairness. The Company binds itself to defend the rights of shareholders 4) Amendments to the Articles of Association, registered 06.21.2007
and ensure fair treatment of all shareholders. The Board of Directors 5) Amendments to the Articles of Association, registered 07.25.2007
provides all shareholders with the opportunity to obtain effective defense 6) Amendments to the Articles of Association, registered 12.24.2007
in the event of violation of their rights. 7) Amendments to the Articles of Association, registered 02.21.2007
» Clarity. The Company ensures the timely disclosure of reliable 2. JSC “OGK-6” CODE OF CORPORATE GOVERNANCE
information regarding all significant facts related to its activities, including The Code of Corporate Governance was confirmed by the Board of
its financial situation, social and ecological indexes, performance, and the Directors on 12.21.2006 (protocol №29 dated 12.25.2006). The objectives of
Company’s management and property structure, as well as open access to the Code of Corporate Governance are the improvement and
such information for all interested parties. systematization of corporate governance of JSC “OGK-6”, facilitation of
greater clarity in Company management, and confirmation of unfailing
» Responsibility. The Company recognizes the rights of all interested readiness on the part of the Company to adhere to the standard of
parties provided for by current legislation, and strives towards cooperation appropriate corporate governance.
with such persons for the purposes of its development and assurance of
financial stability. 3. PROVISION CONCERNING INFORMATION POLICY
The Provision Concerning Information Policy in its new edition was
In its corporate governance practices, JSC “OGK-6” strives to adhere to the confirmed by the 12.21.2006 decision of the Board of Directors (protocol
primary principles presented in the Code of Corporate Conduct № 29 dated 12.25.2006). The Provision defines the composition of
recommended for application by the Federal Financial Markets Service. information disclosed by the Company and the frequency, dates, and
Information on satisfaction of the primary requirements of the Code of procedure for disclosure.
Corporate Conduct is presented in an appendix to this Annual Report.
The Company has adopted the following documents regulating mutual
relations in the sphere of corporate governance.
| CORPORATE GOVERNANCE STRUCTURE
AND PRINCIPLES 86 | 87
4. PROVISION CONCERNING INSIDER INFORMATION 8. PROVISION CONCERNING PAYMENT OF BONUSES AND
The Provision Concerning Insider Information in its new edition was COMPENSATION TO MEMBERS OF THE JSC “OGK-6” BOARD OF
confirmed by the 12.25.2007 decision of the Board of Directors (protocol DIRECTORS
№ 40 dated 05.25.2007). The action of the Provision is directed towards The Provision Concerning Payment of Bonuses and Compensation to the
preventing use of non-public information, in the interests of individuals. JSC “OGK-6” Board of Directors was approved by decision of the annual
The use of insider information is supervised by a separate structural unit of General Shareholders’ Meeting of JSC “OGK-6” on 06.29.2007 (protocol №5).
the Company. The Provision defines the procedure and amount of bonuses and
compensation paid to members of the Board of Directors. The action of the
5. PROVISION CONCERNING THE PROCEDURE FOR PREPARATION Provision does not extend to members of the Board of Directors who are
AND HOLDING OF THE GENERAL SHAREHOLDERS’ MEETING the Company CEO or members of the Company’s collegial executive body.
The Provision Concerning the Procedure for Preparation and Holding of
the General Shareholders’ Meeting was approved by decision of the Board 9. PROVISION CONCERNING THE AUDIT COMMITTEE
of Directors of JSC RAO UES of Russia, which fulfilled the function of an The Provision Concerning the Audit Committee was approved by decision
extraordinary General Shareholders’ Meeting of JSC “OGK-6” on 07.29.2005 of the Board of Directors of JSC RAO UES of Russia, which fulfilled the
(protocol № 200). The Provision defines the procedure for preparation and function of an extraordinary General Shareholders’ Meeting of JSC “OGK-6”
holding of the General Shareholders’ Meeting and forms of conducting the on 07.29.2005 (protocol № 200). The Provision defines the tasks of the
meeting, and elaborates on the functions of the labor bodies of the Audit Committee and their rights and obligations, and establishes the
General Meeting. procedure for conducting audits.
6. PROVISION CONCERNING THE PROCEDURE FOR CONVENING 10. PROVISION CONCERNING PAYMENT OF BONUSES AND
AND HOLDING A MEETING OF THE BOARD OF DIRECTORS COMPENSATION TO MEMBERS OF THE AUDIT COMMITTEE
The Provision Concerning the Procedure for Convening and Holding a The Provision Concerning Payment of Bonuses and Compensation to
Meeting of the Board of Directors was approved by decision of the Board Members of the Audit Committee was approved by decision of the Board
of Directors of JSC RAO UES of Russia, which fulfilled the function of an of Directors of JSC RAO UES of Russia, which fulfilled the function of an
extraordinary General Shareholders’ Meeting of JSC “OGK-6” on 07.29.2005 extraordinary General Shareholders’ Meeting of JSC “OGK-6” on 07.29.2005
(protocol № 200). The Provision defines the procedure for convening and (protocol № 200). The Provision establishes the amount, form, and
holding a meeting of the Board of Directors, and elaborates on the timelines for payment of bonuses and compensation to members of the
functions of the Chairman of the Board of Directors, the rights and Audit Committee, as well as to specialists/experts employed by the Audit
obligations of the members of the Board of Directors, and the status of the Committee.
secretary of the Board of Directors.
7. PROVISION CONCERNING ADMINISTRATION The texts of the documents are published on the Company’s website:
The Provision Concerning Administration was approved by decision of the www.ogk6.ru
Board of Directors of JSC RAO UES of Russia, which fulfilled the function of
an extraordinary General Shareholders’ Meeting of JSC “OGK-6” on
07.29.2005 (protocol № 200). The Provision contains the primary tasks of
the Administration, elaborates of the procedure for forming the
Administration, defines the rights, obligations, and responsibilities of the
members of the Administration, and establishes the procedure for holding
meetings of the Administration in praesentia and in absentia
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
II. INFORMATION ON ADMINISTRATIVE A change in the composition of the Board of Directors occurred in the
AND CONTROL BODIES Company in 2007.
GENERAL COMPANY SHAREHOLDERS’ MEETING Composition of the Board of Directors for 05.11.2006 – 04.05.2007:
The General Shareholders’ Meeting is the supreme administrative authority. » Chikunov, Alexander Vasilyevich
The General Shareholders’ Meeting provides shareholders with the (Chairman of the Board of Directors from 11.18.2006);
opportunity to exercise their right to participate in management of the » Vainzikher, Boris Felixovich
Company by making decisions on the most important questions of the (Chairman of the Board of Directors from 06.06.2006 to 11.17.2006);
Company’s activities within the competence of the General Shareholders’ » Arinin, Sergei Vladimirovich;
Meeting. The Board of Directors, executive bodies, and the Audit » Kazakov, Alexander Ivanovich;
Committee are accountable to the General Shareholders’ Meeting. The » Kaigorodov, Dmitry Alexandrovich;
competence of the General Shareholders’ Meeting and the timelines and » Nepsha, Valery Vasilievich;
procedure for preparation and holding and forms of holding thereof are » Remes, Seppo Yukha;
defined in the Federal Law “On Joint-Stock Companies”, in the Articles of » Sanko, Valentin Mikhailovich;
Association, and in the Provision Concerning the Procedure for Preparation » Fil, Sergei Sergeevich
and Holding of the General Shareholders’ Meeting of JSC “OGK-6”. » Shtykov, Dmitry Viktorovich;
» Shumilov, Alexander Alexandrovich.
BOARD OF DIRECTORS. CHANGES IN THE COMPOSITION
OF THE BOARD OF DIRECTORS. PORTION OF COMPANY SHARES On May 4, 2007, a Company’s Board of Directors consisting of the
BELONGING TO MEMBERS OF THE BOARD OF DIRECTORS following was elected at an Extraordinary JSC “OGK-6” General
General management of the Company’s activities is exercised by the Board Shareholders’ Meeting (Protocol №4 dated 05.07.2007) :
of Directors, which makes decisions on significant issues of the Company’s
activity within the competence defined in the Articles of Association. The Composition of the Board of Directors for 05.04.2007 – 06.29.2007:
procedure for the activities of the Company’s Board of Directors is » Chikunov, Alexander Vasilyevich
regulated by the Articles of Association and the Provision Concerning the (Chairman of the Board of Directors from 05.25.2007);
Procedure for Convening and Holding Meetings of the Board of Directors » Burnashev, Dmitry Alexandrovich;
of JSC “OGK-6”. The Board of Directors is a collegiate body made up of 11 » Yukhnevich, Yury Bronislavovich;
persons. The members of the Board of Directors are selected by the » Evkharitsky, Alexander Valerievich;
General Shareholders’ Meeting for a term extending to the following » Melnikov, Dmitry Alexandrovich;
annual General Shareholders’ Meeting. By decision of the General » Sokolovsky, Mikhail Zinovievich;
Shareholders’ Meeting, the authority of all members of the Board of » Tsuranov, Igor Grigorievich;
Directors may be terminated ahead of schedule. Persons elected to the » Sanko, Valentin Mikhailovich;
Board of Directors may be reelected an unlimited number of times. » Remes, Seppo Yukha;
Candidates for election to the Board of Directors may be nominated by » Nepsha, Valery Vasilievich;
shareholders owning not less than 2% of the Company’s voting shares, as » Repin, Igor Nikolaevich.
well as on the initiative of the Board of Directors.
ORGANIZATION OF CORPORATE GOVERNANCE AUDIT GENERAL AUDIT
OF JSC “OGK-6” SHAREHOLDERS’ COMMITTEE
MEETING
BOARD RELIABILITY COMMITTEE
OF DIRECTORS FOR THE BOARD OF DIRECTORS
ADMINISTRATION STRATEGY AND BUSINESS PLANNING
COMMITTEE FOR THE BOARD OF DIRECTORS
CEO AUDIT COMMITTEE FOR THE BOARD
OF DIRECTORS
EXECUTIVE
OFFICE
INTERNAL
REVIEW BOARD
| CORPORATE GOVERNANCE STRUCTURE
AND PRINCIPLES 88 | 89
On June 29, 2007, a Company’s Board of Directors consisting of the » Reliability Committee of the Board of Directors
following was elected at an JSC “OGK-6” General Shareholders’ Meeting » Audit Committee of the Board of Directors
(Protocol #5 dated ): » Strategy and Business Planning Committee of the Board of Directors.
Composition of the Board of Directors since 06.29.2007: The amount and procedure for payment of bonuses and compensation
» Melnikov, Dmitry Alexandrovich to members of the Company’s Board of Directors is determined in
(Chairman of the Board of Directors since 07.12.2007) accordance with the “Provision Concerning Payment of Bonuses and
» Burnashev, Dmitry Alexandrovich; Compensations to Members of the JSC “OGK-6” Board of Directors”.
» Evkharitsky, Alexander Valerievich; Payment of bonuses and compensation is made by the Company in
» Nepsha, Valery Vasilievich; monetary form.
» Remes, Seppo Yukha;
» Sanko, Valentin Mikhailovich; For participating in a meeting of the Board of Directors conducted in
» Sokolovsky, Mikhail Zinovievich; absentia (by questionnaire), a member of the Company’s Board of
» Fil, Sergei Sergeevich Directors is paid bonuses in the amount of a sum equal to seven
» Tsuranov, Igor Grigorievich; minimum monthly base rates for first-category workers, established by
» Shatsky, Pavel Olegovich; industrial rate agreement in the RF electrical power complex (hereinafter
» Yukhnevich, Yury Bronislavovich. called Rate Agreement) as of the day of the meeting of the Company’s
Board of Directors, with allowance for indexation established by the
The independent directors in accordance with the Code of Corporate Agreement, within seven calendar days of the meeting of the Company’s
Conduct of FFMS of Russsa, recommended by order #421/r for Board of Directors.
observance by joint-stock companies, are recognized to be:
» Melnikov, Dmitry Alexandrovich; For participation in a meeting of the Board of Directors conducted in the
» Burnashev, Dmitry Alexandrovich; presence of the shareholders, a member of the Company’s Board of
» Evkharitsky, Alexander Valerievich; Directors is paid bonuses in the amount of a sum equal to ten minimum
» Nepsha, Valery Vasilievich; monthly base rates for first-category workers, established by industrial
» Sokolovsky, Mikhail Zinovievich; rate agreement in the RF electrical power complex (hereinafter called
» Fil, Sergei Sergeevich Rate Agreement) as of the day of the meeting of the Company’s Board of
» Tsuranov, Igor Grigorievich; Directors, with allowance for indexation established by the Agreement,
» Shatsky, Pavel Olegovich; within seven calendar days of the meeting of the Company’s Board of
» Yukhnevich, Yury Bronislavovich. Directors.
In 2007 the Board of Directors held 29 meetings, of which 5 were in the The amount of the bonuses paid to the Chairman/Deputy Chairman for
presence of the shareholders. A total of 276 issues were examined. each meeting at which the latter performed the function of Chairman of
the Board of Directors, is increased by 50%.
The following are among the most important of the resolutions adopted
in 2007 by the JSC “OGK-6” Board of Directors: The minimum monthly base rate for a first-category worker established
by industrial rate agreement in the RF electrical power complex was
1. Ratification of the strategy of JSC “OGK-6” for 2007-2011 and to 2015 2,700 rubles as of 01.01.2007, 2,792 rubles as of 04.01.2007, 2,854
(Protocol № 35 dated 03.27.2007); rubles as of 07.01.2007, 2,903 rubles as of 10.01.2007, and 3,021 rubles
as of 01.01.2008.
2. Ratification of the JSC “OGK-6” Options Program (Protocol № 49 dated
21.09.2007); Members of the Board of Directors are paid an additional bonus based
on the Company’s net profit according to the annual financial statement
3. Ratification of the Resolutions regarding the issue and Prospectus of approved by the General Company Shareholders’ Meeting in accordance
interest-bearing documentary nonconvertible bonds of JSC “OGK-6” to with the procedure established by the Provision.
the bearer of series 01 and 02 (Protocol №31 dated 15.02.2007);
Members of the Board of Directors are paid an additional bonus in the
4. Ratification of the Resolution regarding the issue and Prospectus of an event of an increase in the Company’s market capitalization during the
additional share issue placed by open subscription, in accordance with a work of the Board of Directors (the time from the election of the
resolution to increase authorized share capital adopted by the JSC “OGK- member of the Board of Directors to the time of the election of a new
6” General Shareholders’ Meeting (Protocol №45 dated 08.15.2007); membership of the Board of Directors) in accordance with the procedure
established in the Provision.
5. Determination of the placement price of additional Company shares
(Protocol № 57 dated 12.19.2007); In 2007, for participation in the work of the Board of Directors, members
of the JSC “OGK-6” Board of Directors received bonuses of: 4,828,233
6. Ratification of the composition of the Committees of the Board of rubles.
Directors (Protocol № 54 dated 11.29.2007):
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
In July 2007, members of the Board of Directors were paid bonuses The Audit Committee of the Board of Directors is obliged to present
totaling 1,772,911.41 rubles for 2006 profit. economically efficient and legally substantiated recommendations/
opinions to the Board of Directors on issues related to the competence
For an increase in the amount of the Company’s market capitalization, of the Committee, and to inform the Company’s Board of Directors in a
between 02.02.2007 and 05.04.2007, additional bonuses totaling timely fashion of risks to the Company.
32,216,402.90 rubles were paid to members of the JSC “OGK-6” Board of
Directors in accordance with the “Provision Concerning Payment of The number of Committee members is determined by decision of the
Bonuses and Compensation to Members of the JSC “OGK-6” Board of Company’s Board of Directors, to be no less than 3 (three) and no more
Directors”. than 5 (five) persons. The members of the Committee are elected by the
Company’s Board of Directors solely from among the members of the
COMMITTEES OF THE BOARD OF DIRECTORS Board of Directors by majority vote of members of the Board of Directors
In the interest of efficiency of the work of the Company’s Board of participating in the meeting of the Board of Directors.
Directors on issues of productivity analysis, appraisal of technical status,
exploitation level and repair of power facilities, and appraisal of technical The composition of the Audit Committee of the Board of Directors
services, as per the December 21, 2005, decision of the JSC “OGK-6” Board was determined by the 11.29.2007 resolution of the Board of
of Directors, a reliability committee of the Board of Directors was created. Directors (protocol #54):
The number of Committee members is determined by decision of the » Sokolovsky, Mikhail Zinovievich;
Company’s Board of Directors, to be no less than 3 (three) and no more » Remes, Seppo Yukha;
than 7 (seven) persons. The members of the Committee are elected by » Shatsky, Pavel Olegovich.
the Company’s Board of Directors from among candidates nominated by
the Company’s Board of Directors. By the decision of the JSC “OGK-6” Board of Directors dated 02.14.2007
(protocol № 31 dated 15.02.2007), the Strategy and Business Planning
The composition of the Reliability Committee of the Board of Committee of the Board of Directors was created. The Committee is a
Directors was determined by the resolution of 11.29.2007 of the consulting and advisory organ, ensuring efficient performance of the
Board of Directors (protocol #54): Company’s Board of Directors in their functions of general management
» Zagretdinov, Ilyas Shamilevich — deputy managing director of of the Company’s activities. The task of the Committee is the
Business Unit №1 of JSC RAO UES of Russia; development and presentation of recommendations/opinions to the
» Zorko, Yu.S. – head of the Territorial Center of DP Board of Directors and executive bodies of the Company on issues
Tsentrenergotekhnadzor for Ryazan Region; related to determining of priority lines of activity, strategic objectives.
» Petelin, Sergei Alexandrovich — head of the technical and The number of members of the Committee is defined by decision of the
industrial administration of the energy complex of JSC SUEK; Company’s Board of Directors, to be no less than 3 (three) and no more
» Radchenko, Sergei Valerievich — chief expert of the exploitation than 5 (five) persons. The members of the Committee are elected by the
and fuel supply administration and of Business Unit № 1 of JSC RAO Company’s Board of Directors by a majority of three-quarters of the votes
UES of Russia; of the total number of members of the Board of Directors, from among
» Selyakov, Aleksei Nikolaevich — deputy CEO of Economy and candidates nominated by members of the Company’s Board of Directors.
Finance of JSC “OGK-6”;
» Tatarinov, Nikolai Alexandrovich — deputy CEO of Production and The composition of the Strategy and Business Planning Committee
Head Engineer of JSC “OGK-6”; of the Board of Directors was determined by the 11.29.2007
» Sychev, Vladimir Borisovich — head of the Department of resolution of the Board of Directors (protocol #54):
Development of the Electric Power Sector, the Office of Development » Sutkovoi, Igor Yurievich — deputy head of the business planning
of the Electric Power Sector and marketing in the electric power department of the corporate center of JSC RAO UES of Russia;
industry of JSC Gazprom. » Melnikov, Dmitry Alexandrovich — chairman of the JSC “OGK-6”
Board of Directors, executive director of Business Unit № 1 of JSC RAO
By resolution of the JSC “OGK-6” Board of Directors dated 02.14.2007 UES of Russia;
(protocol № 31 dated 02.15.2007), in the interest of efficiency of the » Selyakov, Aleksei Nikolaevich — deputy CEO of Economy and
Company’s Board of Directors in resolving issues in its jurisdiction, the Audit Finance of JSC “OGK-6”;
Committee of the Board of Directors was created. The task of the Committee » Shatsky, Pavel Olegovich — member of the JSC “OGK-6” Board of
is the development and presentation of recommendations/opinions of the Directors, JSC SUEK deputy director of power, mergers, and
Company’s Board of Directors in the area of auditing and internal review. In acquisitions;
accordance with the Provision Concerning the Audit Committee of the » Fedorov, Denis Vladimirovich — head of JSC Gazprom’s
Board of Directors, the appraisal of candidates for Company auditor, appraisal department of development of the electric power sector and electric
of the opinion of the Company’s auditor, and appraisal of the efficiency of power marketing;
the internal review procedures and preparation of proposals for improving
them are within the competence of the Committee.
| CORPORATE GOVERNANCE STRUCTURE
AND PRINCIPLES 90 | 91
INFORMATION CONCERNING MEMBERS
OF THE BOARD OF DIRECTORS
1. MELNIKOV, DMITRY ALEXANDROVICH — CHAIRMAN OF THE BOARD OF DIRECTORS
Year of birth: 1975
Education: graduated Omsk State University in 2001
Employment for the past 5 years: 2002 – present
JSC RAO UES of Russia, project manager for the Center for
Implementation of the AO-energo Reform Project, Executive Director
of Business Unit №1
2007 – present
JSC YGK TGK-8, JSC Energosbyt Rostovenergo, JSC Kamchatskenergo,
JSC Sakhalinenergo, JSC Far East Energy Asset Management Company,
JSC TGK-2, Chairman of the Board of Directors
2007 – present
JSC TGK-9, JSC Volgogradenergosbyt, ZAO Regional Power Service,
member of the Board of Directors.
Owns no shares in JSC “OGK-6”
2. BURNASHEV, DMITRY ALEXANDROVICH
Year of birth: 1964
Education: graduated the S. Ordzhonikidze Moscow Institute of Management
in 1989
Employment for the past 5 years: 2002 – present
JSC RAO UES of Russia, Head of the department of economics of the
holding company and subsidiaries
2004 – present
Head of the department
of business planning of the Corporate Center
2007 – present
NP INVEL, JSC IDGS of Centre and North Caucasus, JSC TGK-9,
Noncommercial environmental investment organization Energy Carbon
Fund, JSC Kaluzhskaya Sales Company, JSC OGK-4, JSC Orelenergo,
member of the Board of Directors
Owns no shares in JSC “OGK-6”
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
3. EVKHARITSKY, ALEXANDER VALERIEVICH
Year of birth: 1963
Education: graduated Ivanov Energy Institute in 1985.
Employment for the past 5 years: 1997–2004
JSC Kostromskaya GRES, deputy head of boiler
and turbine workshop №1
2004 – present
JSC RAO UES of Russia, manager of exploitation and prospective
development of Business Unit №1, chief expert of exploitation and fuel
supply of Business Unit №1
2007 – present
JSC TGK-4, JSC Komi Energy Sales Company, member of the Board
of Directors
Owns no shares in JSC “OGK-6”
4. NEPSHA, VALERY VASILIEVICH
Year of birth: 1976
Education: graduated the International Academy of Marketing and Management
in 1997, Higher School of Economics State University in 1999.
Employment for the past 5 years: 2000–2003
JSC RAO UES of Russia, spokesman, chief specialist of the Department of
Corporate Policy
2003 – present
Institute of Professional Directors fund, deputy CEO
2007 – present
JSC Kursenergo, JSC Astrakhanenergo, JSC Chelyabenergo,
JSC Vologdaenergo, JSC Chitaenergo, JSC Dagenergo, JSC KEUK,
member of the Board of Directors
Owns no shares in JSC “OGK-6”
| CORPORATE GOVERNANCE STRUCTURE
AND PRINCIPLES 92 | 93
5. REMES, SEPPO YUKHA
Year of birth: 1955
Education: graduated the University of Oulu, 1984; Candidate of economics (School
of Economics and Business Administration, 1994)
Employment for the past 5 years: 2001–2003
Vostok Energo Investment Ltd, President
2002 – present
JSC OMZ, member of the Board of Directors, chairman of the Audit
Committee of the Board of Directors
2003–2004
Vostok Nafta Investment ltd, director
2003 – present
JSC RAO UES of Russia, member of the Board of Directors, chairman of
the Audit Committee of the Board of Directors, member of the Appraisal
Committee of the Board of Directors, member of the Strategy and
Reformation Committee of the Board of Directors
2004–2007
Finnish Sitra fund (the National Fund for Strategic Research and
Development o fthe Parliament of the Republic of Finland), senior
advisor
2004 – present
ZAO FIM Investment Bank (Russia), Corporate Finance (the largest
Investment Bank in Finland), senior advisor
2004 – present
JSC Severstal-Auto, member of the Board of Directors, chairman of the
Audit Committee of the Board of Directors
2007 – present
JSC RAO UES of Russia, JSC IDGC of the Central and Volga regions, JSC
IDGC of the Volga, JSC HydroOGK, JSC SO-CDU-UES, JSC Kirovsky Zavod,
JSC Severstal-Auto, JSC OMZ, JSC Sibur Holding, Ponsse Oyj EOS Russia
(a Finnish JSC / logging equipment), member of the Board of Directors
Owns no shares in JSC “OGK-6”
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
6. SANKO, VALENTIN MIKHAILOVICH
Year of birth: 1963
Education: graduated Leningrad Voznesensky Institute of Finance and Economics in
1990, candidate of economics.
Employment for the past 5 years: 2001–2005
ОJSC SUEK, CEO
JSC KGRES-2, JSC KiGRES, JSC Novocherkasskaya GRES, JSC Ryazanskaya
GRES, JSC Cherepovetskaya GRES; CEO (part-time)
2005 – present
JSC “OGK-6”, CEO, Chairman of the Administration, member of the Board
of Directors
Portion of shares owned
in JSC “OGK-6”: 0.02929%
7. SOKOLOVSKY, MIKHAIL ZINOVIEVICH
Year of birth: 1973
Education: graduated Omsk State University in 1995
Employment for the past 5 years: 1999–2005
JSC JSCB International Trade Bank, head of the legal department,
member of the Administration
2005 – present
JSC RAO UES of Russia, head of the legal department of Business Unit #1
2007 – present
JSC TGK-5, JSC Lipetsk Energy Sales Company, JSC Kamchatskenergo,
SC TGK-14, JSC Neryungrienergoremont, member of the Board of
Directors
Owns no shares in JSC “OGK-6”
| CORPORATE GOVERNANCE STRUCTURE
AND PRINCIPLES 94 | 95
8. FIL, SERGEI SERGEEVICH
Year of birth: 1980
Education: graduated Moscow Humanitarian Social Academy in 2002
Employment for the past 5 years: 2002 – present
JSC RAO UES of Russia, first-category specialist, leading specialist, chief
specialist, acting head of the department of corporate events of the
Department of Corporate Policy, head of the Department of Corporate
Events of Business Unit #1
2007 – present
JSC Mosenergo, JSC Astrakhan Energy Sales Company, JSC Komi Energy
Sales Company, JSC Mosenergosbyt, JSC Permenergosbyt, JSC TGK-4,
JSC TGK-8, JSC DEK, JSC Sakhenergo, JSC DGK, JSC DESP, JSC COPEnergo,
member of the Board of Directors
Owns no shares in JSC “OGK-6”
9. TSURANOV, IGOR GRIGORIEVICH
Year of birth: 1964
Education: graduated the Moscow State Institute of Electronics in 1987
Employment for the past 5 years: 2002–2004
JSC ROSNO, deputy CEO
2004–2006
Azovstal plant, Director of Strategy and Investments
2006–2007
JSC RAO UES of Russia, Executive Director, Director of Investments of
Business Unit #1
Owns no shares in JSC “OGK-6”
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
10. SHATSKY, PAVEL OLEGOVICH
Year of birth: 1972
Education: graduated RosNOU (bachelor’s in jurisprudence) in 1996, RGAZU
(manager) in 1997, GUU / GAU (lawyer — specialist) in 2002
Employment for the past 5 years: 2000–2005
JSC RUSAL, JSC RUSAL-UK, head of the legal department, head of the
department of rate policy, director of the energy department
2001–2003
JSC Nizhnovenergo, deputy CEO of reform and property
2005 – present
JSC SUEK, Director of the Strategy Department of the energy complex,
deputy director of strategy, mergers, and acquisitions
2007 – present
JSC Far East Generating Company, JSC Kuzbass Energy Sales Company,
JSC Prokopievskenergo, JSC Dalenergosetproekt, JSC Primorskoi Supergrid
Company, JSC Far East Energy Company, JSC Yenisei TGK (TGK-13),
JSC Kuzbassenergo, JSC Kuzbassenergo Electric Supergrid,
JSC Buryatenergosbyt, JSC Chita Energy Sales Company,
JSC Kuzbassgidroenergostroi, JSC Khabarovsk Power Technology
Company, JSC Khakassia SRK, JSC Sakhenergo, JSC TGK-11, member
of the Board of Directors
Owns no shares in JSC “OGK-6”
11. YUKHNEVICH, YURY BRONISLAVOVICH
Year of birth: 1976
Education: graduated the Modern University for the Humanities in 1997, Candidate
of Economics, Moscow Academy of Finance and Law in 2004
Employment for the past 5 years: 2000–2007
JSC RAO UES of Russia, chief specialist of the department of capital
management, chief expert of the department of capital management,
chief expert of the department of strategy of the Center for Reform
Management, head of the department of strategy of the Center for
Reform Management
2007 – present
Federal Energy Agency, Advisor to the director of the Federal Energy,
Reform, and Property Agency
2007 – present
JSC Volgogradenergo, JSC Astrakhanenergo, JSC Sverdlovenergo,
JSC Moscow Heating Network Company, JSC Moscow Municipal
Electrical Network Company, JSC Vologdaenergo, member of the Board
of Directors
Owns no shares in JSC “OGK-6”
| CORPORATE GOVERNANCE STRUCTURE
AND PRINCIPLES 96 | 97
EXECUTIVE
BODIES
CHIEF EXECUTIVE OFFICER Quarterly and yearly KPI, their values, methods of calculating indicators,
The CEO is the sole executive body of the Company, and has the right to and the procedure for calculating the amount of the bonus are approved
act on behalf of the Company without power of attorney. The CEO heads by order of the CEO.
the Administration, acting as Chairman of the Administration. The CEO is
accountable to the General Shareholders’ Meeting and the Company’s The amount of quarterly bonuses on condition of meeting established
Board of Directors. The CEO is appointed to the post by the Board of KPI values comprises up to 1.5 (one and one half ) times official salaries.
Directors. The CEO bears responsibility for realization of the objectives, The amount of annual bonuses on condition of meeting established KPI
strategies, and policy of the Company. values is up to 12 (twelve) official salaries.
Issues of material incentives for the CEO are regulated by the Provision If KPI and additional bonus requirements specified by the order are met,
Concerning Material Incentives for the Chief Executive Officer, approved the Company CEO has the right to award additional bonuses to senior
on October 7, 2005, by the Board of Directors. Bonuses for the CEO are managers on the results of Company’s work for the accounting year in
awarded for meeting key performance indicators (quarterly and yearly) an amount of up to 6 (six) official salaries.
established annually by the Company’s Board of Directors, as well as for
performance of particularly important tasks, receipt of state and industry A special bonus is established for senior managers attaining a high
awards, and performance of tasks related to reforming the Company. indicator for Ownership Capital Profitability KPI on the results of the
Company’s operations for the accounting year (total for all senior
ADMINISTRATION managers) in an amount of up to 1% of net Company profit. The decision
The administration is the collegiate executive body of the Company, and to pay a special bonus and in what amount is made by the Company
manages day-to-day activity. The Administration is accountable to the CEO depending on the contribution of the senior manager to the results
General Shareholders’ Meeting and the Company’s Board of Directors. of the Company’s operations. Additionally, the Provision Concerning
Members of the Administration are appointed to their posts by the Board Material Incentives for Senior Managers provides for a one-time bonus
of Directors. The Administration bears responsibility for realization of the for particularly important tasks, not to exceed 6 (six) official salaries for a
objectives, strategies, and policy of the Company. The Chairman of the single task; a bonus in the event of receiving state and industry awards;
Company’s Administration is the Chief Executive Officer. The activity of and a bonus for performance of reform-related tasks.
the Administration is regulated by the Articles of Association and the
Provision Concerning the Administration. The Administration develops On September 21, 2007, the JSC “OGK-6” Board of Directors approved the
long-term plans for realization of the main lines of activity and presents JSC “OGK-6” Options Program (Protocol № 49 dated 09.21.2007), which
them for consideration to the Board of Directors, preliminarily considers, determines the procedure for receipt by Options Program participants of
develops, and presents to the Board of Directors recommendations the right to acquire shares in JSC “OGK-6”, as well as the procedure for
regarding specific issues within the competence of the Board of Directors, Options Program participants to exercise their right to acquire Company
examines reports of deputy CEOs, and makes decisions regarding the shares at a previously determined price. Within the context of the Options
conclusion of transactions with a value comprising 1% – 10% of the book Program, a purchase and sale agreement of Company shares is concluded
value of Company’s assets. Members of the Administration are elected by between the Options Program operating company and the participant,
the Board of Directors in a number determined by the Board of Directors. with a delayed transfer of property rights to shares and payment within 3
In accordance with the October 7, 2005, decision of the Board of years of the date of conclusion of the agreement. The Options Program is
Directors, the Administration consists of eight persons. unlimited and intended for the entire period of the Company’s activities.
The current number of ordinary shares distributed in the context of the
The labor compensation system for members of the Administration is Options Program is approved annually by the Company’s Board of
defined by labor contracts, as well as by the Provision Concerning Directors by proposal of the CEO. The total number of ordinary Company
Material Incentives for Senior Managers of JSC “OGK-6”. In accordance shares allotted to the Options Program shall not be greater than 2% of the
with the Provision, members of the Administration, such as deputy CEOs, total number of ordinary Company shares placed. The purchase and sale
are considered senior managers, and the action of this Provision extends price of shares is defined as the average weighted price of ordinary
to them. The Company’s Administration has no members of the Company shares calculated as of the date of conclusion of the contract
Administration that are not deputy Company CEOs. for a period of 365 days prior to the date of conclusion of the contract
according to ZAO FB MICEX data. Participants in the Options Program
A system of bonuses is established for senior managers for meeting key may be the CEO, Senior Managers (members of the Administration, the
performance indicators (KPI) for accounting periods (quarter and year). chief accountant, a branch manager) and Company workers specified by
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
the CEO. Company workers having the right to participate in the Options Program and the number of shares
that each such worker may acquire are determined independently by the CEO. For each participant in the
Options Program the following maximum number of ordinary shares is established within 2% of the total
number of ordinary Company shares placed: CEO — 0.3%; senior manager — 0.15%; worker — 0.05%.
No purchase and sale contracts of shares were concluded in the context of the Options Program in 2007.
The table below presents the total amount of bonuses paid to all persons that were members of the Company
Administration, including the Chairman of the Administration, for 2007.
The membership of the Administration did not change in 2007.
BONUSES
thousand rubles
Salaries 20,653
Increases and supplements 8,323
Bonuses 35,527
TOTAL: 64,503
| CORPORATE GOVERNANCE STRUCTURE
AND PRINCIPLES 98 | 99
MEMBERSHIP
OF THE ADMINISTRATION
1. SANKO, VALENTIN MIKHAILOVICH —
CHAIRMAN OF THE ADMINISTRATION, JSC “OGK-6” CEO
Year of birth: 1963
Place of birth: Zarechka, Lyubansky District, Minsk Region, Belorussia
Education: graduated Leningrad Voznesensky Institute of Finance and Economics
in 1990, candidate of economics
Nationality: Russian Federation
Employment for the past 5 years: 2005 – present
JSC “OGK-6”, CEO, Chairman of the Administration, member of the Board
of Directors
2005–2005
JSC KGRES-2, JSC KiGRES, JSC Novocherkasskaya GRES,
JSC Ryazanskaya GRES, JSC Cherepovetskaya GRES;
CEO (part-time)
2001–2005
JSC SEUK, CEO
Portion of shares owned
in JSC “OGK-6”: 0.02929%
2. BINKO, GENNADY FELIXOVICH
Year of birth: 1958
Place of birth: Moscow
Education: graduated the Moscow Institute of Engineering and Physics in 1982 and
the All-Russian Extramural Institute of Finance and Economics in 2004,
candidate of physics mathematics
Nationality: Russian Federation
Employment for the past 5 years: 2005 – present
JSC “OGK-6”, deputy CEO of sales and marketing, member of the
Administration
2001–2005
JSC SEUK, deputy CEO of management of JSC Arkhenergo
Owns no shares in JSC “OGK-6”
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
3. GULYAEV, VALERY ALEXEEVICH
Year of birth: 1957
Place of birth: Vologda
Education: graduated Vologodsky Technical Institute in 1980 and Rostov State
University of Construction in 1999
Nationality: Russian Federation
Employment for the past 5 years: 2005 – present
JSC “OGK-6”, deputy CEO of purchasing and logistics,
member of the Administration
2001–2005
JSC SEUK, director of resources
Portion of shares owned
in JSC “OGK-6”: 0.0055%
4. DUBENETSKY, VIKTOR PETROVICH
Year of birth: 1961
Place of birth: Pinsk, Brestsk Region, Belorussia
Education: graduated Belorussian State University in 1986
Nationality: Russian Federation
Employment for the past 5 years: 2005 – present
JSC “OGK-6”, deputy CEO,
member of the Administration
2002–2005
MID RF, First Secretary of Department 2 of the CIS
2000–2002
MID RF, Second Secretary of the Department of North Asian Countries
Owns no shares in JSC “OGK-6”
| CORPORATE GOVERNANCE STRUCTURE
AND PRINCIPLES 100 | 101
5. KOLESNIKOV, ALEXANDER STEPANOVICH
Year of birth: 1957
Place of birth: Sochi
Education: graduated the S. Ordzhonikidze Moscow Institute
of Aviation in 1983
Nationality: Russian Federation
Employment for the past 5 years: 2005 – present
JSC “OGK-6”, deputy CEO of corporate governance and personnel
management, member of the Administration
2000–2005
JSC RAO UES of Russia, head of the Department of Shareholder Relations
of the Corporate Center
Owns no shares in JSC “OGK-6”
6. SELYAKOV, ALEXEI NIKOLAEVICH
Year of birth: 1959
Place of birth: Alekseevo, Vologda District, Vologda Region
Education: graduated Vologodsky Dairy Institute in 1981 and the St. Petersburg
Voznesensky University of Finance and Economics in 1994, candidate
of economics
Nationality: Russian Federation
Employment for the past 5 years: 2005 – present
JSC “OGK-6”, deputy CEO of economics and finance,
member of the Administration
2001–2005
JSC SEUK, director of finance
Owns no shares in JSC “OGK-6”
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
7. TATARINOV, NIKOLAI ALEXANDROVICH
Year of birth: 1959
Place of birth: Zaozerny, Krasnoyarskaya Territory
Education: graduated Krasnoyarskaya Technical Institute in 1981
Nationality: Russian Federation
Employment for the past 5 years: 2005 – present
JSC “OGK-6”, deputy CEO of production —
chief engineer, member of the Administration
2004–2005
ZAO PRP Energoremont, technical director —
first deputy CEO
2003–2004
JSC KiGRES, chief engineer
2000–2003
JSC KGRES-2, first deputy — chief engineer
Owns no shares in JSC “OGK-6”
8. CHEKHOEV, ASLAN INALOVICH
Year of birth: 1965
Place of birth: Tkhinvali, South Ossetian Autonomous Area
Education: graduated First Leningrad Pavlov
Medical Institute in 1989
Nationality: Russian Federation
Employment for the past 5 years: 2005 – december 2007
JSC “OGK-6”, deputy CEO of investment implementation
and capital development
2005 – january 2008
JSC “OGK-6”, member of the Administration
2004–2005
Central Company of Financial and Industrial Group JSC RusInkor,
first vice president of industrial assets and sales management
2003–2004
JSC Kiselevskugol Coal Company, first deputy CEO
1997–2003
JSC TMK-OK, director
Owns no shares in JSC “OGK-6”
| CORPORATE GOVERNANCE STRUCTURE
AND PRINCIPLES 102 | 103
AUDIT COMMITTEE
The Company’s Audit Committee is elected by the General Shareholders’ Meeting to supervise the Company’s
financial and economic activities. The Audit Committee is a collegial body consisting of five persons. The order
of the Audit Committee’s activities is regulated by the Articles of Association and the Provision Concerning the
Audit Committee.
For participation in checking (auditing) financial and economic activities, a member of the Audit Committee is
paid a one-time bonus amounting to three times the minimum monthly base rate for first-category workers
adjusted for indexation established by the industry rate agreement. For each check (audit) of financial and
economic activities conducted, members of the Audit Committee may be paid additional bonuses of up to
twenty times the minimum monthly base rate for first-category workers adjusted for indexation established by
the industry rate agreement. The procedure and dates for payment of additional bonuses are determined by
the Company’s Board of Directors. The amount of bonuses paid to the Chairman of the Audit Committee is
increased by 50%. A member of the Audit Committee is compensated for expenses related to participation in
the meeting of the Audit Committee and audits conducted, as per the norms of business expense
compensation current at the time of the meeting or audit.
In 2007 members of the Audit Committee were paid bonuses of 565,375 rubles.
From 05.11.2006 to 06.29.2007 an Audit Committee selected by decision of the Board of Directors of JSC RAO
UES of Russia, acting as an annual JSC “OGK-6” General Shareholders’ Meeting on 05.11.2006 (protocol #221),
operated in the Company with the following membership:
» Zavartsev, Alexei Vladimirovich
» Ivanov, Alexei Evgenievich
» Minifaeva, Yulia Evgenievna
» Sidorov, Sergei Borisovich
» Uzgorov, Igor Ivanovich
On 06.29.2007 the Annual General Shareholders’ Meeting of JSC “OGK-6” (protocol #5 dated 06.29.2007) elected
a Company Audit Committee with the following membership:
1. SIDOROV, SERGEI BORISOVICH — CHAIRMAN OF THE AUDIT COMMITTEE
Year of birth: 1952
Education: higher
Employment for the past 5 years: 1999–2004
JSC RAO UES of Russia, head of the Department of Financial Auditing
2004 – present
JSC RAO UES of Russia, head of the Department of Internal Auditing of
the Corporate Center
Owns no shares in JSC “OGK-6”
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
2. ZAVARTSEV, ALEXEI VLADIMIROVICH
Year of birth: 1966
Education: higher
Employment for the past 5 years: 2001–2003
JSC Sveza-Les, deputy CEO of economics and finance, commercial director
2003–2005
JSC SEUK, deputy CEO of internal auditing
2005 – present
JSC “OGK-6”, Manager of the Board of Internal Auditing, member of the Audit Committee
Owns no shares in JSC “OGK-6”
3. IVANOVA, KSENIA VALARIEVNA
Year of birth: 1970
Education: higher
Employment for the past 5 years: 2000 – present
JSC RAO UES of Russia, first-category specialist, leading specialist, chief specialist of the Department of Capital Records;
chief specialist, leading expert, head expert of the Department of Corporate Governance of the Corporate Center; chief expert,
head of the office of the Department of Corporate Governance and Shareholder Relations of the Corporate Center
Owns no shares in JSC “OGK-6”
4. KLESHNINA, NATALIA VIKTOROVNA
Year of birth: 1960
Education: higher
Employment for the past 5 years: 2000–2007
JSC RAO UES of Russia, leading expert of the Department of Internal Auditing
of the Corporate Center
Owns no shares in JSC “OGK-6”
5. PROSTOKISHINA, TATIANA ALEXANDROVNA
Year of birth: 1957
Education: higher
Employment for the past 5 years: 2000–2007
JSC RAO UES of Russia, chief specialist and leading expert of the Department
of Internal Auditing of the Corporate Center
Owns no shares in JSC “OGK-6”
| CORPORATE GOVERNANCE STRUCTURE
AND PRINCIPLES 104 | 105
AUDITOR
The Company Auditor is approved annually by the General Shareholders’ Meeting for the purposes of auditing
the Company’s financial and economic activities in accordance with legislative acts of the Russian Federation
on the basis of a contract concluded with the former. The amount of payment for the services of the Auditor is
determined by the Company’s Board of Directors. The Company Auditor audits the Company’s financial and
economic activity in accordance with the requirements of the legislation of the Russian Federation and on the
basis of a contract concluded with the former.
By decision of the Annual General Shareholders’ Meeting of JSC “OGK-6” (protocol № 5 dated 06.29.2007) the
Company Auditor approved ZAO Pricewaterhouse Coopers Audit.
The amount of payment for the services of the auditor for 2007 was 43,286,313.22 rubles, including:
» for conducting audits of accounting reports compiled in accordance with the 2005 international financial
reporting standard — 507,400 rubles;
» for conducting audits of accounting reports compiled in accordance with the 2006 international financial
reporting standard — 4,708,200 rubles;
» for conducting audits of accounting reports compiled in accordance with the requirements of Russian
legislation for 2006 — 5,015,000 rubles;
» for information and consulting services — 14,026,407.82 rubles;
» for audit services related to a prospectus — 1,971,225.40 rubles;
» for audit services — 17,058,080 rubles.
Maracana
THE MARACANA STADIUM, ONE OF THE WORLD’S LARGEST SOCCER FIELDS,
SEATS 200,000 FANS. THE WHOLE OGK-6 TEAM OF 6,406 EMPLOYEES
MAY BE SEATED IN ONE SECTOR OF THE STADIUM.
| ANNUAL REPORT
| 2007
| JSC “OGK-6”
106 | 107
8 OUR
STAFF
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
8. OUR
STAFF
The main lines of JSC “OGK-6” staff compensation, a quarterly analysis I. PERSONNEL STAFF STRUCTURE BY SUBSIDIARIES
policy for 2007 were formulated of the implementation was STRUCTURE AND THE COMPANY EXECUTIVE OFFICE
with allowance for the formation of conducted, with a subsequent AS OF 12.31.2007, %
an integrated Company structure discussion of the results with the The total number of personnel of
upon completion of reorganization directors of personnel services JSC “OGK-6” as of December 31,
on 09.29.2006 (from the time of the and chairmen of subsidiary labor 2007, was 6406 persons, including
creation of Company subsidiaries). union committees. 913 managers, 1377 specialists,
In regard to this: 56 executives, and 4060 workers.
4. For the purposes of forming a
3.8%
1. Measures have been carried corporate culture, the first summer
out in the context of social Olympics of JSC “OGK-6” workers
partnership with the Board of were held. 6.7%
24.2%
Representatives of Primary Trade
Union Organizations of JSC “OGK- 5. In 2007, the RSLR Committee, 11.7%
6” for implementation of a unified formed under parity conditions of
system of labor compensation, the administration and subsidiary
and on April 1, 2007, the labor union committees,
subsidiaries transitioned to a conducted four meetings on 14.9% 21.1%
unified provision concerning labor compromise resolution of issues
compensation of workers of JSC of labor and social mutual
“OGK-6” subsidiaries. relations within the staff.
17.6%
2. On January 1, 2007, a collective 6. In order to evaluate the
agreement for 2007–2008 came dynamics of changes in personnel,
into affect in all subsidiaries, under an internal audit of staff and staff
unified conditions agreed by the processes (IASSP) was instituted and
Committee for Regulation of is currently in effect in Company — RGRES
Social Labor Relations (RSLR subsidiaries, according to the results
Committee) of JSC “OGK-6”. of which recommendations are — NchGRES
made to the directors of subsidiaries
3. In relation to the transition to a for personnel selection, rotation, — KiGRES
unified system of labor and training.
— KGRES-2
— ChGRES
NAME OF SUBSIDIARY TOTAL NUMBER OF PERSONS
persons — GRES-24
Ryazanskaya GRES 1,354 — ExOffice
Novocherkasskaya GRES 1,549
Kirishskaya GRES 956
Krasnoyarskayay GRES-2 1,128
Cherepovetskaya GRES 747
GRES-24 430
Executive branch 242
TOTAL FOR JSC “OGK-6”: 6 406
| OUR STAFF
108 | 109
CHANGE IN THE TOTAL NUMBER In the period of 2005-2007, total Optimization of personnel led to a
OF COMPANY PERSONNEL FOR 2004–2007 number of Company employees reduction of the share of worker
decreased by 515 persons. positions and an increase in the
share of specialists in the
The primary causes of reduction in personnel structure. The increase
7000 the number of personnel are: in the share of specialists likewise
» withdrawal of non-core occurred due to an increase in the
(service) subdivisions, which in number of employees in the
particular lead to a significant company’s executive office. The
reduction in the number of share of executive office
personnel of GRES-24 and employees in the number of
6921 6558 6406 Ryazanskaya GRES. Company employees increased
» optimization of numbers and from 3.3% in 2006 to 3.8% in 2007.
structural subdivisions with
6000 duplicated functions (195 full-
time personnel in 2007 alone).
31.12.2005 31.12. 2006 31.12. 2007
CHANGE IN THE TOTAL NUMBER OF PERSONNEL
OF COMPANY SUBSIDIARIES FOR 2005–2007
1600
1467 1379 1354 1537 1570 1549 974 979 954 1162 1139 1128 783 803 747 874 472 430
0
RGRES NchGRES KiGRES KGRES-2 ChGRES GRES-24
—31.12.2005 — 31.12.2006 — 31.12.2007
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
COMPOSITION OF WORKERS BY PERSONNEL
14.3% — Workers CATEGORY AS OF 12.31.2007, %
0.9%
— Specialists
21.5%
— Managers
— Executives
63.4%
AGE PROFILE OF WORKERS
— 30 and over
AS OF 12.31.2007, %
17.2%
— Under 30
6%
— Working retirees
76.8%
One of the Company’s important who are capable of efficiently for 2006 (17.2%); the share of
tasks in the area of personnel accomplishing the tasks facing the working retirees likewise remained
management is the formation of a Company. In 2007, the share of at a level of 6%.
motivated staff and attraction of employees under 30 years of age
young specialists to the company was successfully kept at the level
CATEGORY AS OF 12.31.2005 AS OF 12.31.2006 AS OF 12.31.2007 COMPOSITION OF WORKERS
Managers * 1 044 1 005 913
Specialists 1 196 1 303 1 377
Executives 93 65 56
Workers 4 607 4 185 4 060
* Managers include: skilled workers, supervisors, deputy heads of structural subdivisions (workshops, departments, services, laboratories,
offices, boards), directors and deputy subsidiary directors, and managers of JSC “OGK-6“
AGE PROFILE AS OF 12.31.2005 AS OF 12.31.2006 AS OF 12.31.2007 AGE PROFILE OF WORKERS
Under 30 years 1,070 1,129 1,100
30 years to retirement age 5,351 5,082 4,921
Working retirees 500 347 385
| OUR STAFF
110 | 111
DYNAMICS OF CHANGE IN THE SHARE
OF EMPLOYEES WITH HIGHER EDUCATION
IN COMPANY SUBSIDIARIES IN 2005–2007,
%
40
32 33.3 34.8 28.2 30.5 31.6 29.7 31.7 34.5 33.4 34 33.7 21.8 26.2 28.5 24.7 35.2 38.3
0
RGRES NchGRES KiGRES KGRES-2 ChGRES GRES-24
— 31.12.2005 — 31.12.2006 — 31.12.2007
EDUCATION LEVEL 14.7 million rubles . The share of attention will be given to the
In 2007 the education level of personnel that underwent training of reserve staff and
company personnel continued to professional training out of the anticipatory training of employees.
grow: the share of employees with total number of Company
higher education increased by personnel was 39.1% in 2007,
1.7%, from 33.8% in 2006 to 35.5% including 53.9% for the executive
in 2007. office. For the period 2005–2007,
the share of workers that
25.7% of company employees underwent professional training
have post-secondary education. out of the total number of workers
The share of the latter decreased increased by 12.2%.
by 0.5% in 2007 in comparison
with 2006. Training and staff development of
workers in Company subsidiaries
The company’s management is conducted in accordance with
recognizes the importance of on- the JSC RAO UES of Russia
going staff development and Standard for training, retraining,
professional training of employees. and staff development of
In 2007, expenses for education personnel, implemented in the
and retraining of personnel were Company. In 2008–2009, primary
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
II. SALARIES The average salary of workers of The growth of the average salary in
company subsidiaries (GRES) in company subsidiaries in 2007 was
2007 was 24,098 rubles, or 14% achieved primarily due to the
more than in 2006. The growth rate growth of the average salary
of the average salary of subsidiary among specialists and workers.
workers is equal to the growth rate
of the consumer price index, which
in 2007 was 11.9%.
JSC “OGK-6” SUBSIDIARIES AVERAGE MONTHLY SALARY OF WORKERS, IN RUBLES AVERAGE MONTHLY EMPLOYEE SALARIES
2005 2006 2007 BY OKG-6 BRANCH
Ryazanskaya GRES 16,861 20,970 22,062
Novocherkasskaya GRES 19,207 21,298 21,897
Kirishskaya GRES 22,016 23,307 26,830
Krasnoyarskayay GRES-2 20,836 26,782 28,831
Cherepovetskaya GRES 15,237 16,489 21,000
GRES-24 20,858 21,507 25,320
TOTAL FOR ALL GRES 19,143 21,136* 24,098
* Results for 2006, adjusted on the basis of reports provided by subsidiaries.
PERSONNEL CATEGORY AVERAGE MONTHLY SALARY OF WORKERS, IN RUBLES AVERAGE MONTHLY EMPLOYEE SALARIES
2006 2007 % growth BY PERSONNEL CATEGORY
Managers 36,930 40,172 108.8
Specialists and engineers 20,374 23,996 117.8
Workers 15,971 18,896 118.3
TOTAL FOR ALL GRES 21,136 24,098 114
| OUR STAFF
112 | 113
III. RETIREMENT For the purposes of ensuring The parity plan is based on the
PROGRAM social security of Company principle that worker and
employees and veterans in employer jointly and in equal
accordance with the principles proportions have the ability to
contained in the strategy of the finance the NPP for the worker.
nongovernmental pension
program for workers of companies In 2007, the total amount of
included in the power holding financing of all joint Company
company JSC RAO UES of Russia, accounts opened in the NPFP and
Nongovernmental Pension its subsidiaries was 127,472,359
Programs (NPP) for Company rubles Financing in the amount of
workers are developed annually. 120,918,448 rubles is provided
for in 2008.
The nongovernmental pension
program of JSC “OGK-6” workers is
called upon to ensure a fitting
quality of life for Company workers
of retirement age and efficient
resolution of staff issues related to
attraction, retention, and
motivation of personnel. The base
nongovernmental pension fund
for realization of the NPP of JSC
“OGK-6” workers is the
Nongovernmental Pension Fund
of the Power Industry (NPFP).
The structure of the NPP of JSC
“OGK-6” workers includes programs
of corporate and parity plans.
The corporate plan unites pension
programs in the context of which
the company arranges additional
NPPs for its workers using internal
funds on the basis of the respective
Provision concerning NPPs and the
NPP contract concluded with the
nongovernmental pension fund.
Zeppelin NT
THE XXI CENTURY IS REVIVING AIRSHIPS, THE MOST ENVIRONMENTALLY
SAFE TRANSPORT. WE CARE ABOUT THE ENVIRONMENTAL SAFETY OF OUR
PRODUCTION. IN 2007, THE COMPANY REDUCED HAZARDOUS EMISSIONS
BY OVER 12%.
| ANNUAL REPORT
| 2007
| JSC “OGK-6”
114 | 115
9 ENVIRONMENTAL
PROTECTION
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
9. ENVIRONMENTAL
PROTECTION
Environmental protection is one of 43.6 thousand tons less than in I. ENVIRONMENTAL
the primary tasks of all industries, 2006 (3.3%). PROTECTION MEASURES
including the electrical power
industry. It is widely known that For each OGK-6 plant, over 80% of In 2007, the Greenhouse Gas
the process of electric power and pollutants formed are neutralized. corporate information analysis
heat generation produces a Due to the fact that at Kirishskaya system (GGCIAS) was
negative effect on the GRES and GRES-24 the primary implemented at OGK-6 power
environment protection, in other form of fuel used is gas, pollutants plants. At Novocherkasskaya GRES
words the greater the volume of formed as a result of the operation and Cherepovetskaya GRES, plans
power generated, the more of these plants primarily contain for standards of maximum
pollutants will be formed. sulfur dioxide (SO2), carbon permissible atmospheric
monoxide (CO), and nitrous oxide, emissions (MPE) were developed.
In 2007, 1,536.2 thousand tons of which are impossible to neutralize, Additionally, repairs of aspiration
pollutants were formed due to the since at present there are no and dust extraction plants were
activity of JSC “OGK-6” power processes for neutralizing them. carried out at Cherepovetskaya
plants, which is 70.2 thousand GRES. At Kirishskaya GRES, an
tons less than in 2006 (or a entire series of tasks for the
decrease of 4.6%). reconstruction of the chemical
water treatment system was
Understanding the importance performed in 2007.
of environmental protection, the
company constantly monitors
the environmental situation and
implements measures for
neutralizing and recycling
pollutants formed due to plant
operation. In 2007, 1,325.8
thousand tons of pollutants
were trapped and neutralized, or
INDEX | TOTAL POLLUTANTS FORMED | POLLUTANTS CAPTURED AND NEUTRALIZED | PORTION OF NEUTRALIZED POLLUTANTS, %
2005 2006 2007 2005 2006 2007 2005 2006 2007
Ryazanskaya GRES 413,879 262,453 323,860 363,046 223,027 280,818 88 85 87
Novocherkasskaya GRES 671,275 788,173 713,306 595,797 691,427 628,388 89 88 88
Kirishskaya GRES 6,987 18,862 7,030 0 0 0 0 0 0
Krasnoyarskayay GRES-2 269,580 263,776 291,009 223,094 214,303 241,246 83 81 83
Cherepovetskaya GRES 101,353 272,471 200,298 86,621 240,643 175,482 85 88 88
GRES-24 607 629 663 0 2 0 0 0 0
TOTAL FOR OGK-6 1,463,682 1,606,363 1,536,206 1,268,558 1,369,402 1,325,936 87 85 86
| ENVIRONMENTAL PROTECTION
116 | 117
II. ATMOSPHERE
POLLUTION
The total volume of pollutant Convention on Climate Change enterprises for further inclusion of
emissions into the atmosphere for (FCCC) in Kyoto (Japan, December greenhouse gas emissions in the
2007 was 210 thousand tons, or 27 of 1997). In accordance with the Russian register of carbon units and
thousand tons (13%) less than for protocol, Russia is obliged to limit for meeting FCCC requirements.
2006. The reduction in pollutant annual emissions of greenhouse In accordance with this decision, a
emissions occurred primarily due to gases in 2008-2012 to a level not contract has been concluded
a change in the fuel composition at exceeding the level of greenhouse between JSC “OGK-6” and the non-
the plants. gas emissions in 1990. profit environmental investment
organization Energy Carbon Fund
Climate change is one of the most In ratifying the Kyoto Protocol, each for inventory of greenhouse gases
widely discussed problems in the country assumes specific for 1990-2005 and for creation and
modern world. The greenhouse obligations on a national level. The implementation of the Greenhouse
effect is caused by water vapor, most significant of these is a tally of Gases information analysis system of
carbon dioxide, methane, nitrous greenhouse gas emissions and JSC “OGK-6”.
oxide, and a range of other gases of reporting in accordance with the
which the atmosphere contains an FCCC rules. As per the Kyoto The objective of the work is to
insignificant concentration. The Protocol, all developed countries create the conditions for attracting
greenhouse effect has always (including the RF) are obliged to investments intended for
existed; however, today it is being create a national system of appraisal implementing measures for
increased anthropogenically. of anthropogenic emissions no later increasing energy efficiency and
than 2007. Reports of greenhouse energy conservation, which help
To regulate emissions of gas emissions are planned for reduce greenhouse gas emissions,
greenhouse gases, the Kyoto inclusion in the new generation of and for using the Kyoto Protocol
Protocol, which establishes the ISO standards. mechanisms of Anticipated Project
obligations of developed countries Credit Periods: 2009-2012 and 2011-
to regulate greenhouse gas In JSC RAO UES of Russia, the 2012, respectively. At this stage, the
emissions in 2008-2012, was decision has been made to create a preliminary project information has
adopted at the Third Conference of corporate cadastre and organize a been developed in its entirety. In
the Parties of the UN Frames monitoring system at holding accordance with the provisions of
DYNAMICS OF ATMOSPHERE POLLUTION, POWER PLANT | TOTAL ATMOSPHERE POLLUTION
IN TONS for 2005 for 2006 for 2007
Ryazanskaya GRES 50,833 39,426 43,042
Novocherkasskaya GRES 75,478 96,746 84,916
Kirishskaya GRES 6,987 18,862 7,030
Krasnoyarskaya GRES-2 46,486 49,473 49,762
Cherepovetskaya GRES 14,732 31,827 24,815
GRES-24 604 626 664
TOTAL FOR “OGK-6” 195,124 236,960 210,231
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
the Kyoto Protocol, attraction of The reduction in greenhouse gas the ecological audit, the
“land investments” is possible after emissions is due to the change in environmental work conducted by
preparation of technical fuel. the enterprise was highly rated.
documentation, project Despite a significant increase in the
determination, and conclusion of In the context of the program of volumes of electric power
purchase and sale contracts of Units implementation of the company’s generation, a more than two-fold
of Reduced Emissions with environment protection policy, an decrease has been noted in the
subsequent registration of projects ecological audit of JSC “OGK-6” volumes of emissions in comparison
in the RF JIP of the Ministry of subsidiaries GRES-24, Kirishskaya with 1995, due to the
Economic Development and Trade. GRES, and Novocherkasskaya GRES implementation of a set of
Performance and organization of has been conducted. The environmental protection measures.
these tasks is taken into account in conclusion has been reached that
the contracts concluded between the plants are ready for
JSC “OGK-6” and NIEO Energy implementation of the ecological
Carbon Fund. management system of the ISO
14001:2004 international standard
Emissions of greenhouse gases by in the area of environmental
“OGK-6” power plants in 2007 protection, which provides for
decreased by 11,427 thousand tons evaluation of enviromental activity
(or 33%) in comparison with 2006. by European standards. Following
40,000 DYNAMICS OF GREENHOUSE
5,341 GAS EMISSIONS FOR 2005–2007,
IN THOUSAND TONS
13,930
1,606
13,808 221
11,677
15,551
12,205 11,497
0
2005 2006 2007
— from coal burning — from gas burning — from fuel oil burning
| ENVIRONMENTAL PROTECTION
118 | 119
DYNAMICS OF GREENHOUSE GASES EMISSIONS IN ACCORDANCE WITH THE TYPE OF FUEL USED, IN THOUSAND TONS
TYPE OF FUEL 2005 2006 2007 2007/2006 CHANGES
Gas
Ryazanskaya GRES 2,916 2,885 3,444 559
Novocherkasskaya GRES 2,006 1,940 2,285 345
Kirishskaya GRES 6,831 7,221 3,939 - 3,282
Cherepovetskaya GRES 1,173 821 951 130
GRES-24 883 1,063 1,055 -8
Total for OGK-6 13,808 13,930 11,677 - 2,253
Oil and thermal
Ryazanskaya GRES 19 264 5 - 259
Novocherkasskaya GRES 14 55 - - 55
Kirishskaya GRES 1,567 5,000 207 - 4,793
Krasnoyarskaya GRES-2 4 8 6 -2
Cherepovetskaya GRES 1 15 3 - 12
Oil and thermal, total for OGK-6 1,606 5,341 221 - 5,120
Solid fuel
Ryazanskaya GRES 2,129 2,953 2,820 - 133
Novocherkasskaya GRES 4,942 6,264 1,614 - 4,650
Krasnoyarskaya GRES-2 4,461 102 5,315 5,213
Cherepovetskaya GRES 1,873 1,098 1,746 648
Solid fuel, total for OGK-6 12,205 15,551 11,497 - 4,054
TOTAL GREENHOUSE GAS EMISSIONS FOR OGK-6 27,619 34,822 23,395 - 11,427
Hubble
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| ANNUAL REPORT
| 2007
| JSC “OGK-6”
120 | 121
10 FINANCIAL
ACCOUNTING
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
10. FINANCIAL
ACCOUNTING
I. AUDIT REPORT
The text of the audit report of ZAO
Pricewaterhouse Coopers Audit AUDITOR’S REPORT
on the financial (accounting) ON FINANCIAL (ACCOUNTING) STATEMENTS*
report of JSC “OGK-6” for 2007 is
presented below. The said To: Shareholders of Open Joint-Stock Company The Sixth Wholesale Power Market Generating
accounting report is not included Company
in this annual report. Hence, all
references to the appended Auditor
accounting report contained in
the audit report pertain to Closed Joint-Stock Company PricewaterhouseCoopers (ZAO PwC Audit)
documents not presented in this Certificate of State Registration of ZAO PwC Audit No. 008.890 issued by the Moscow State
Annual Report. This audit report is Registration Chamber on February 28, 1992.
applicable only to the 2007
accounting report of JSC “OGK-6”. Certificate of the Unified State Register of Legal Entities of a register entry made before July 1,
A copy of the audit report and the 2002, No. 1027700148431 of August 22, 2002, issued by Interdistrict Tax Inspectorate of the
accounting report of JSC “OGK-6” Russian Ministry of Taxes and Levies No. 39 of Moscow.
for 2007 is posted in electronic
form on the JSC “OGK-6” website Audit License No E000376 issued by the Ministry of Finance of the Russian Federation on May 20
(www.ogk6.ru) in the Shareholders 2002. The license is valid until May 20, 2012.
and Investors section.
Member of the Russian Institute of Professional Accountants and Auditors and the Russian Audit
Chamber.
Auditee
Open Joint-Stock Company The Sixth Wholesale Power Market Generating Company
49 Bolshaya Sadovaya Street, Rostov-on-Don, 344007, Russian Federation.
Certificate of state registration of the joint-stock company under state registration number
1056164020769, issued by the Leninsky District Tax Inspectorate of the Russian Ministry of Taxes
and Levies of Rostov-on-Don on March 17, 2005.
The company is the authorized user of the company name and trademark “PricewaterhouseCoopers” (2)
* Original document is prepared in Russian.
| FINANCIAL ACCOUNTING
122 | 123
AUDITOR’S REPORT
on financial (accounting) statements of Open Joint-Stock Company
The Sixth Wholesale Power Market Generating Company*
To: Shareholder of Open Joint-Stock Company The Sixth Wholesale Power Market Generating
Company:
1. We have audited the accompanying financial (accounting) statements of Open Joint-Stock
Company The Sixth Wholesale Power Market Generating Company (the “Company”) for the
period from January 1, 2007, through December 31, 2007. Financial (accounting) statements of
the Company include Accounting Balance Sheet, Profit and Loss Statement, Statement of
Changes in Equity, Cash Flow Statement, Balance Sheet Supplement, and Explanatory Note
(hereinafter, all reports are collectively referred to as “Financial (Accounting) Statements”) in
accordance with the law of the Russian Federation applicable to preparing financial
(accounting) statements. The Statements prepared under the above laws are materially
different from the statements prepared under the International Financial Reporting Standards.
2. The Company’s executive body is responsible for preparing and submitting financial
(accounting) statements. Our responsibility is to express an opinion as to whether the financial
statements give a true and fair view and are properly prepared in accordance with the laws of
the Russian Federation based on our audit.
3. We conducted our audit in accordance with the Federal Law on Audit Activity, the Federal
laws/standards of auditing, International Standards on Auditing, and our own internal
standards.
The audit was planned and conducted so as to obtain reasonable assurance about whether the
financial (accounting) statements are free of material misstatements. This audit included
examining, on a test basis, evidence supporting the amounts and disclosures in the financial
(accounting) statements. The audit also included an assessment of adherence to the
accounting principles and standards used in preparing the financial (accounting) statements
and an examination of key estimates made by management of the Company, as well as an
evaluation of the overall presentation of the financial (accounting) statements. We believe that
our audit provides a sufficient basis for our opinion on true presentation of the financial
(accounting) statements and the compliance of accounting statements to the laws of the
Russian Federation.
(3)
* Original document is prepared in Russian.
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
AUDITOR’S REPORT*
4. As of December 31, 2007, items 230 and 240 of the Company’s Balance Sheet report
unredeemed and uncovered buyer’s accounts receivable for shipped goods in the amount of
391,239 rubles. No allowance for this debt is credited. The company failed to report this
doubtful debt in its annual balance sheet for 2007, as well as its plans for collecting it. Possible
overstatement of accounts receivable and profit is evaluated at 391,239 rubles.
5. In our opinion, except for the effect of the circumstances indicated in the above paragraph on
the financial (accounting) statements, the Company’s financial (accounting) statements
attached to this Report present fairly, in all material respects, the financial position of the
Company for the period from January 1 through December 31, 2007, in accordance with the
laws of the Russian Federation applicable to the preparation of financial (accounting)
statements.
April 4, 2008
Director of JSC Franz J. Kaiser
Auditor S.A. Blokhin
Qualification Certificate No. K008770
General Audit
Unlimited
Conclusion
Of the Audit Committee of JSC OGK-6 on the
Reliability of Data Contained
(4)
* Original document is prepared in Russian.
| FINANCIAL ACCOUNTING
124 | 125
II. COMPANY FINANCIAL
STATEMENTS FOR 2007
BALANCE SHEET AS OF 31.12.2007, , THOUSAND RUBLES
ASSET CODE AS OF REPORTING YEAR BEGINNING AS OF REPORTING YEAR END
1 2 3 4
I. FIXED ASSETS
Intangible assets 110 7 –
Fixed assets 120 16,130,343 15,719,673
Construction-in-progress 130 942,816 2,153,884
Interest-bearing investments in tangible assets 135 – –
Long-term financial investments 140 53242 8,575,166
Deferred tax assets 145 545225 390,340
Other fixed assets 150 20192 132,153
– 151 – –
TOTAL ON SECTION I 190 17,691,825 26,971,216
II. CURRENT ASSETS
Inventories 210 3,176,790 3,323,191
Including:
raw materials, materials and other similar assets 211 2,955,530 3,243,593
rearers and fatteners 212 4,480 532
WIP costs 213 555 –
end products and goods for resale 214 5,468 28,383
shipped goods 215 2,728 15
prepaid expenses 216 208,029 50,668
other inventories and costs 217 – –
– 218 – –
VAT on acquired assets 220 86,860 43,534
Accounts receivable (payment expected 230 501,768 2,626,988
over 12 months after the reporting date)
including buyers and customers 231 382,377 345,399
Accounts receivable (payment expected 240 1,729,448 3,754,579
within 12 months after the reporting date)
including buyers and customers 241 626,586 728,339
Short-term financial investments 250 19,686 6,407,827
Cash 260 143,259 648,427
Other current assets 270 77 629
– 271 – –
TOTAL ON SECTION II 290 5,657,888 16,805,175
BALANCE 300 23,349,713 43,776,391
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
PROFIT AND LOSS STATEMENTS
LIABILITIES CODE AS OF REPORTING YEAR BEGINNING AS OF REPORTING YEAR END
1 2 3 4
III. CAPITAL AND RESERVES
Share capital 410 26,731,061 15,486,028
Own shares, acquired from shareholders 411 – 177
Earned capital 420 3,807,820 22,170,905
Reserve capital 430 135,260 197,345
including:
Reserves under the applicable law 431 – –
Reserves under incorporation documents 432 135,260 197,345
– 433 – –
Retained profit (uncovered loss) 470 (17,962,891) (2,967,218)
TOTAL ON SECTION III 490 12,711,250 34,886,883
IV. LONG-TERM LIABILITIES
Borrowings 510 2,503,596 5,000,000
Deferred tax liabilities 515 229,976 240,257
Other long-term liabilities 520 925,592 553,313
– 521 – –
TOTAL ON SECTION IV 590 3,659,164 5,793,570
V. SHORT-TERM LIABILITIES
Borrowings 610 4,011,745 69,301
Accounts payable 620 2,767,258 2,750,280
including:
suppliers and contractors 621 1,946,270 2,026,295
debts to Company’s employees 622 92,342 139,488
state non-budgetary funds 623 22,640 23,442
tax and levies debts 624 450,363 374,243
other creditors 625 255,643 186,812
Distributions payable to members/founders 630 194,643 258,089
Deferred income 640 5,653 18,236
Provisions for liabilities and charges 650 – –
Other short-term liabilities 660 – 32
– 661 – –
TOTAL ON SECTION V 690 6,979,299 3,095,938
BALANCE 700 23,349,713 43,776,391
| FINANCIAL ACCOUNTING
126 | 127
LIABILITIES CODE AS OF REPORTING YEAR BEGINNING AS OF REPORTING YEAR END
1 2 3 4
CERTIFICATE on values recorded
to off-balance sheet accounts
Leased fixed assets 910 547,603 5,996,792
including leasing 911 85,839 109,420
Inventory items under custody 920 74,990 76,842
Goods taken on commission 930 – –
Written-off receivables of insolvent debtors 940 3,461,296 3,461,567
Security received 950 103,118 1,049,254
Security issued 960 487,869 85,913
Depreciation of housing stock 970 – 3,132
Depreciation of improvements and other similar facilities 980 6,286 6,286
Intangible assets obtained for usage 990 – 2,960
Leased out fixed assets 995 43,771 42,031
Federally owned property 996 – 7,582
Strict security forms 997 62 123
JSC OGK-6 management obtained the above information from the full set of the Company’s accounting statements for 2007. The annual report does not include the above accounting statements in full. A full copy of the Company’s accounting
statements in accordance with the Russian Accounting Standards is posted on the JSC OGK-6 website (www.ogk6.ru) in the Shareholders and Investors Information section.
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
PROFIT AND LOSS STATEMENT FOR 2007
PROFIT AND LOSS STATEMENT CODE AS OF REPORTING YEAR BEGINNING AS OF REPORTING YEAR END
1 2 3 4
INCOME AND EXPENSES FOR ORDINARY ACTIVITIES
Net revenue on sales of goods, products, work, services 010 35,333,820) 9,222,277)
(excluding VAT, excise tax and similar mandatory payments)
electricity and capacities 011 33,195,199) 7,476,091)
thermal energy 012 1,884,964) 534,501)
income from participating in other organizations 013 –) 687,328)
other goods, work, and services 014 253,657) 524,357)
Cost of sold goods, products, work, services 020 (31,629,550) (7,304,141)
electricity and capacities 021 (29,871,431) (6,405,469)
thermal energy 022 (1,528,360) (470,872)
other goods, work, and services 023 (229,759) (427,800)
Gross profit 029 3,704,270 1,918,136)
Commercial expenses 030 (24,479) (14,674)
Managerial expenses 040 () ()
Sales profit/loss 050 3,679,791) 1,903,462)
OTHER INCOME AND EXPENSES
Interest receivable 060 25,637) 1852)
Interest payable 070 (591,670)) (177,840)
Income from participation in other organizations 080 –) –)
Other incomes 090 652,838) 630,244)
091 –) –)
Other expenses 100 (1,151,063) (217,663)
110 (–) (–)
Profit/loss before tax 140 2,615,533) 2,140,055)
Deferred tax assets 141 (2,224) (20,167)
Deferred tax obligations 142 (10,870) (13,142)
Current profit tax 150 (874,739) (247,147)
Other similar payments 180 145,921) (617,897)
Net profit/loss of reporting period 190 1,873,621) 1,241,702)
REFERENCE
Permanent tax liabilities (assets) 200 259,907) (68,199)
Basic earnings/losses per share 201 0.070) 0.049)
Diluted earnings/losses per share 202 0) 0)
| FINANCIAL ACCOUNTING
128 | 129
BREAKDOWN OF SPECIFIC PROFITS AND LOSSES CODE FOR REPORTING PERIOD FOR THE SAME PERIOD OF THE PREVIOUS YEAR
PROFIT LOSS PROFIT LOSS
1 2 3 4 5 6
Penalties, fines and forfeits, accepted or imposed 210 3,502 22,248 251 1,779
by court decisions (arbitrage)
Profits/losses of previous years 220 136,549 113,471 99 2,408
Arising from failure to perform or improper 230 – 2,056 – 5
performance of obligations
Exchange rate differences on operations 240 39,263 17,459 1,292 58
in foreign currencies
Payments to valuation reserve 250 х – х –
Write-offs of bad debts 260 14,379 56,904 6,833 5
270 – – – –
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
11. APPENDIXES
I. REPORT OF THE
JSC “OGK-6” AUDIT
COMMITTE Report
of the JSC “OGK-6” Audit Committee on the accuracy of the data
contained in the 2007 Annual Report of JSC “OGK-6”*
Moscow April 01, 2007
The Audit Committee of JSC “OGK-6” acting on the basis of the Company Articles of Association
and the Provision Concerning the Audit Committee has conducted an audit of the financial and
economic activities of JSC “OGK-6” on the Company’s results for 2007.
The purpose of the audit was to establish the authenticity of the accounting, statistical, and other
Company documents and the conformance thereof to legislation of the Russian Federation.
The object of the audit was the Company’s financial and economic activities for 2007. Financial
and economic documentation, including financial and statistical reporting, as well as other
documents, were used in conducting the audit.
In accordance with the results of the audit of accounting and financial reporting and other
documentation of the Company’s financial and economic activities, the Audit Committee has
established that:
1. The 2007 Annual Report reliably reflects the Company’s property status and financial results, as
well as the Company’s cash flows.
2. No breaches or distortions in observing the requirements of legislation of the Russian
Federation in making essential financial and economic transactions were established.
3. The financial reporting of JSC “OGK-6” with balance currency in the amount of 43 776 391
thousand rubles reliably reflects the assets and liabilities as of 31.21.2007 and the financial
results of activities for 2007.
4. Net profit of JSC “OGK-6” in the reporting period was 1 873 621 thousand rubles.
Chairman of the Audit Committee S. B. Sidorov
Secretary of the Audit Committee A. V. Zavartsev
* Original document is prepared in Russian.
| APPENDIXES
130 | 131
II. INFORMATION ON OBSERVANCE BY JSC “OGK-6”
OF THE CODE OF CORPORATE CONDUCT
GENERAL SHAREHOLDERS’ MEETING
# CODE OF CORPORATE CONDUCT PROVISION OBSERVED OR NOTES
NOT OBSERVED
1 Notification of shareholders of the holding of a general shareholders’ meeting not less than 30 days Observed. Item 11.5 of the Articles of Association: “The announcement of the holding of a General
prior to the date of its holding regardless of the issues on the agenda, unless more time is provided Shareholders’ Meeting shall be sent (or delivered) to each person specified in the list of persons
for by legislation. having the right to participate in the General Shareholders’ Meeting, shall be published by the
Company in Izvestiya newspaper, and shall be posted on the Company’s website on the Internet no
later than 30 (thirty) days prior to the date of the Meeting.”
2 Opportunity of shareholders to become acquainted with the list of persons having the right to participate in Observed. In accordance with Item 4, Art. 51 of FL “On joint-stock companies”, the list of persons having
the general shareholders’meeting, starting from the day of the announcement of the holding of a general the right to participate in the General Shareholders’ Meeting shall be presented by the Company for
shareholders’meeting until the close of the shareholders’meeting in praesentia, or, in the event of a general examination at the request of the persons included in the list and possessing not less than 1% of the
shareholders’meeting in absentia, until the cut-off date for acceptance of voting ballots. votes.
3 Opportunity of shareholders to examine information (materials) subject to provision in preparation Observed. In accordance with Item 11.7 of the Articles of Association: “... Information (materials) on
for a general shareholders’ meeting by means of electronic communications, including via the issues of the agenda of a General Shareholders’ Meeting shall be posted on the Company’s Internet
Internet. website not later than 10 (Ten) days prior to the date of the General Shareholders’ Meeting…”
4 Opportunity of shareholders to introduce an issue to the agenda of a general shareholders’ meeting Observed. In accepting proposals for the agenda of the General Shareholders’ Meeting, including for candidates
or to request a general shareholders’ meeting without provision of an extract from the shareholder for members of the Board of Directors, the Company independently requests confirmation in the
registry, if the record of the shareholder’s share rights is made in the shareholder registry shareholder registry.
management system, or, in the event that the shareholder’s share rights are based on a DEPO
account, the sufficiency of an extract from the DEPO account to exercise the above-mentioned rights.
5 The presence in the Articles of Association or internal documents of the joint-stock company of a Not observed. According to the second paragraph of item 5.2.2 of the Code of Corporate Governance:
requirement for obligatory presence at the general shareholders’ meeting of the CEO, members of the “The Company as far as possible ensures the presence at the General Shareholders’ Meeting of
administration, members of the board of directors, members of the audit committee, and the joint- members of the Board of Directors, executive bodies, and the audit committee and Company auditor,
stock company auditor. and authorizes them to answer shareholders’ questions.”
6 Obligatory presence of candidates for consideration at the general shareholders’ meeting of issues Not observed The Company Articles of Association and internal documents contain no provisions stipulating the
regarding election of members of the board of directors, the CEO, members of the administration, obligation of their presence at the General Shareholders’ Meeting.
and members of the audit committee, as well as the issue of confirmation of the joint-stock
company auditor.
7 Presence in the joint-stock company’s internal documents of a procedure for registering participants Observed In accordance with Item 3.1 of the Provision on the Procedure for Preparation and
in the general shareholders’ meeting. Holding of the General Shareholders’ Meeting:
Item 3.1.1. Registration of persons having the right to participate in the General Shareholders’
Meeting is conducted by the Counting Board or other entity acting as the counting board, for the
location of the General Shareholders’ Meeting specified in the meeting announcement. Registration
of persons having the right to participate in the General Shareholders’ Meeting begins at the time
specified in the meeting announcement.
Items 3.1.2 – 3.1.6 of the Provision establish in detail the procedure for registering participants
in the general shareholders’ meeting.
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
BOARD OF DIRECTORS
# CODE OF CORPORATE CONDUCT PROVISION OBSERVED OR NOTES
NOT OBSERVED
8 Presence in the joint-stock company’s articles of association of the authority of the board of directors Observed. In accordance with Subsection 19 of Item 15.1 of the Articles of Association, matters
for annual approval of the financial and economic plan of the joint-stock company. within the competence of the Board of Directors are “the confirmation of the business plan
(adjusted business plan) and report on the results of execution thereof, approval (correction) of the
list and values of Company cash flow benchmarks, as well as an examination of adjustments to the
Company’s cash flow adopted by the Company Administration.”
9 Presence of a procedure approved by the board of directors for risk management in the joint-stock Observed. The Company has the Provision Concerning Non-financial Risk Management, approved by
company . the Board of Directors on 04.19.2006 (protocol № 17 dated 04.20.2006) and the Provision
Concerning Credit Policy, approved by the Board of Directors on 07.14.2005 (Protocol № 5).
10 Presence in the joint-stock company’s articles of association of the right of the board of directors to Not applicable. In accordance with Subsection 12 of Item 15.1 of the Articles of Association, a matter
decide to suspend the authority of the CEO appointed by the general shareholders’ meeting. within the competence of the Board of Directors (and not the General Shareholders’ Meeting) is the
“election of the Company CEO and early termination of his authority, including the early termination
of the labor contract with the latter”.
11 Presence in the joint-stock company’s articles of association of the right of the board of directors to Partially observed. In accordance with Subsection 13 of Item 15.1 of the Articles of Association, a matter within
establish requirements for the qualifications and amount of bonuses of the CEO, members of the the competence of the Board of Directors is“the determination of the quantitative membership of the
administration, and managers of main structural subdivisions of the joint-stock company Company Administration and establishment of bonuses and compensation paid to them…”.
In accordance with Item 20.5 of the Articles of Association: the rights and obligations of the CEO
and the members of the Company Administration are defined including by the labor contract
concluded by each with the Company.
The conditions of the labor contract are defined by the Company’s Board of Directors.
The Articles of Association do not provide for the right of the Board of Directors to establish
requirements for the qualifications and amount of bonuses of the managers of main structural
subdivisions of the joint-stock Company.
12 Presence in the joint-stock company’s articles of association of the right of the board of directors to Observed. In accordance with Item 20.5 of the Articles of Association, the conditions of the labor contract,
approve the conditions of contracts with the CEO and members of the administration . including in the area of the term of office, are determined by the Company’s Board of Directors. The
rights and obligations of the employer on behalf of the Company in relation to the CEO and the
members of the Company Administration are exercised by the Chairman of the Board of Directors or
the person authorized by the Company’s Board of Directors.
13 Presence in the articles or internal documents of the joint-stock company of a requirement that Not observed. No such requirements are made in the Articles of Association and internal Company documents.
when approving conditions of contracts with the CEO/managing company/manager and members
of the administration, the votes of members of the board of directors who are the CEO or members of
the administration shall not be considered when counting the votes.
14 Presence in the membership of the joint-stock company’s board of directors of not less than three Observed. The independent directors are:
independent directors meeting the requirements of the Code of Corporate Conduct. - Melnikov, Dmitry Alexandrovich;
- Burnashev, Dmitry Alexandrovich;
- Evkharitsky, Alexander Valerievich;
- Nepsha, Valery Vasilievich;
- Sokolovsky, Mikhail Zinovievich;
- Fil, Sergei Sergeevich
- Tsuranov, Igor Grigorievich;
- Shatsky, Pavel Olegovich;
- Yukhnevich, Yury Bronislavovich.
| APPENDIXES
132 | 133
# CODE OF CORPORATE CONDUCT PROVISION OBSERVED OR NOTES
NOT OBSERVED
15 Absence in the membership of the joint-stock company’s board of directors of persons who were Observed.
found guilty of crimes in the sphere of economic activity or crimes against the state, interests of state
service, and service in local government bodies, or to whom administrative penalties were applied
for infractions in the field of finances, taxes and fees, and the securities market.
16 Absence in the membership of the joint-stock company’s board of directors of persons who are Not observed. As of 12.31.2007,
participants, the CEO (manager), a member of a management body, or a worker of a legal entity in D.A. Burnashev is simultaneously a member of the Board of Directors of JSC OGK-4.
competition with the joint-stock company.
17 Presence in the joint-stock company’s articles of association of a requirement for election of the Observed. Item 10.8 of the Articles of Association: Voting at the General Shareholders’ Meeting shall be
board of directors by a cumulative vote conducted on the principle of “one voting share, one vote”, with the exception of cumulative voting
on the issue of electing members of the Company’s Board of Directors”.
18 Presence in the joint-stock company internal documents of the obligation of the members of the Not observed. This standard is not present in the Company’s internal documents; however, in accordance with the
board of directors to refrain from actions that will lead or are potentially capable of leading to a law “On joint-stock companies” (Article 82) members of the Board of Directors are obligated to notify
conflict between their interests and the interests of the joint-stock company, and, in the event of the Company’s Board of Directors, the audit committee, and the auditor of information concerning
such a conflict, to disclose information concerning this conflict to the board of directors. the conflict of interests and concerning transactions being conducted or planned in which they
might be found to be interested.
19 Presence in the joint-stock company’s internal documents of the obligation of the members of the Observed. In accordance with Item 4.1 of the Provision Concerning Company Insider Information,
board of directors to notify the board of directors in writing of an intention to conduct transactions members of the Company’s Board of Directors are obligated to disclose information of possession of
with securities of the joint-stock company of which they are members of the board of directors, or of Company securities to the Audit Committee under the Company’s Board of Directors.
its subsidiary (dependent) companies, as well as to disclose information regarding transactions with In accordance with Item 4.2 of the Provision Concerning Company Insider Information, “no
such securities conducted by them. later than the third day of the month following the accounting month, insiders are obligated to
provide the Subdivision responsible for control of the use of insider information with a written
declaration of transactions concluded with securities of the Company and/or its subsidiaries and
affiliates in the accounting month”.
20 Presence in the joint-stock company’s internal documents of a requirement for holding a meeting of Not observed. In accordance with Item 5.1 of the Provision on the Procedure for Convening and Holding
the board of directors not less than once every six weeks. Meetings of the Board of Directors, “Meetings of the Board of Directors are conducted in
accordance with the approved Plan of Operation of the Board of Directors, as well as when necessary,
but not less frequently than once per quarter, unless otherwise established by this Provision”.
21 Meetings of the joint-stock company’s board of directors held throughout the the year, at which the Observed. Between 01.01.2007 and 12.31.2007, 29 meetings of the Company’s Board of Directors were held.
annual report of the joint-stock company is compiled, not less than once every six weeks.
22 Presence in the joint-stock company’s internal documents of a procedure for holding meetings of the Observed. The procedure for holding meetings of the Company’s Board of Directors is specified by Article 18 of
board of directors. the Articles of Association, as well as by the Provision Concerning the Convening and Holding
of Meetings of the Board of Directors.
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
# CODE OF CORPORATE CONDUCT PROVISION OBSERVED OR NOTES
NOT OBSERVED
23 Presence in the joint-stock company’s internal documents of a provision concerning the necessity of Observed. In accordance with Subsection 37 of Item 15.1 of the Articles of Association, a matter within the
approval by the board of directors of transactions of the joint-stock company involving a sum of 10 competence of the Company’s Board of Directors is “the preliminary approval of decisions regarding
percent or more of the value of the company’s fixed assets, with the exception of transactions conductance by the Company of b) transactions (including several interrelated transactions), the
concluded in the process of ordinary economic activity. subject of which is property having a value of 10 to 25 percent of the book value of the Company’s
assets as of the date of the decision to conduct such a transaction”.
24 Presence in the joint-stock company’s internal documents of the right of members of the board of Partially observed. Item 3.1 of the Provision on the Procedure for Convening and Holding Meetings of the Board
directors to obtain information necessary for performing their functions from executive bodies and of Directors: “Members of the Board of Directors, within the competence of the Board of Directors,
managers of main structural subdivisions of the joint-stock company, as well as of liability for failure shall have the right:
to provide such information. 1) to receive information concerning the Company’s activities, including information constituting a
Company trade secret…”
In accordance with Item 3.2 of the Provision on the Procedure for Convening and Holding
Meetings of the Board of Directors: “a member of the Board of Directors may request in writing
documents and information necessary for making decisions on issues within the competence of the
Board of Directors…”.
25 Presence of a committee of the board of directors for strategic planning or delegation of the functions Observed . On 02.14.2007 (Protocol № 31 dated 02.15.2007), the Board of Directors made a decision to create a
of such a committee to a different committee (other than the audit committee and the personnel Committee of the Board of Directors for Strategy and Business Planning.
and remuneration committee).
26 Presence of a committee of the board of directors (the audit committee) that recommends the joint- Observed. On 02.14.2007 (Protocol № 31 dated 02.15.2007), the Board of Directors resolved to create an Audit
stock company auditor to the board of directors and cooperates with the latter and the joint-stock Committee of the Board of Directors.
company’s audit committee. The membership of the Audit Committee of the Board of Directors was determined by a resolution of
the Board of Directors (Protocol № 54 dated 11.29.2007):
- Remes, S. Y. – Chairman of the Audit Committee of the Board of Directors
- Sokolovsky, M.Z.
- Shatsky, P.O.
27 Presence in the membership of the audit committee of exclusively independent and non-executive Not observed. S.Y. Remes is not an independent director according to the Code of Corporate Conduct of FFMS of
directors. Russia
28 Management of the audit committee by an independent director. Not observed. S.Y. Remes is not an independent director according to the Code of Corporate Conduct of FFMS of
Russia.
29 Presence in the joint-stock company’s internal documents of the right of access for all members of Observed. Provision on the audit committee of the Board of Directors, approved 02.14.2007 (Protocol
the audit committee to any documents and information of the joint-stock company on condition of № 31 dated 02.15.2007)
nondisclosure by them of confidential information . In accordance with subsection 2, Item 4.1 of the Provision, the Committee is vested with the rights
“to request and receive information and documents necessary for conducting its activity from the
CEO and officials of the Company in accordance with the list approved by decision of the
Committee…”
In accordance with Item 4, Subsection 5.1. of the Provision on the audit committee of the Board of
Directors, the Committee is obligated to observe confidentiality requirements.
30 The creation of a committee of the board of directors (the personnel and remuneration committee) Not observed. No Personnel and Remuneration Committee of the Board of Directors exists in the Company.
the function of which is to determine criteria for the selection of candidates for members of the
board of directors and development of the joint-stock company’s policy in the area of remuneration.
| APPENDIXES
134 | 135
# CODE OF CORPORATE CONDUCT PROVISION OBSERVED OR NOTES
NOT OBSERVED
31 Management of the personnel and remuneration committee by an independent director. Not observed. No Personnel and Remuneration Committee of the Board of Directors exists in the Company.
32 Absence in the membership of the personnel and remuneration committee of joint-stock company Not observed. No Personnel and Remuneration Committee of the Board of Directors exists in the Company.
officials.
33 Creation of a risks committee of the board of directors or delegation of the functions of such a Not observed. No risks committee of the Board of Directors exists in the Company.
committee to a different committee (other than the audit committee and the personnel and
remuneration committee).
34 Creation of a corporate conflict settlement committee of the board of directors or delegation of the Not observed. No corporate conflict settlement committee of the Board of Directors exists in the Company.
functions of such a committee to a different committee (other than the audit committee and the
personnel and remuneration committee).
35 Absence in the membership of the corporate conflict settlement committee of joint-stock company Not observed. No corporate conflict settlement committee of the Board of Directors exists in the Company.
officials
36 Management of the corporate conflict settlement committee by an independent director. Not observed. No corporate conflict settlement committee of the Board of Directors exists in the Company.
37 Presence of joint-stock company internal documents approved by the board of directors stipulating Observed. The 12.21.2005 decision of the Board of Directors (Protocol № 12) approved the Provision
the procedure for the formation and operation of committees of the board of directors. Concerning the Reliability Committee.
The 02.14.2007 decision of the Board of Directors (Protocol № 31 dated 02.14.2007) approved:
- the Provision Concerning the Audit Committee
- the Provision Concerning the Strategy and Business Planning Committee
38 Presence in the joint-stock company’s articles of association of a procedure for definition of a quorum Not observed.
of the board of directors ensuring obligatory participation of independent directors in meetings of
the board of directors.
EXECUTIVE BODIES
# CODE OF CORPORATE CONDUCT PROVISION OBSERVED OR NOTES
NOT OBSERVED
39 Presence of a collegial executive body (administration) of the joint-stock company. Observed. The JSC“OGK-6” Administration is formed in accordance with the Company’s Articles of Association.
40 Presence in the articles of association or internal documents of the joint stock company of a provision Not observed.
concerning the necessity of approval by the administration of transactions involving real estate and
obtaining of credits by the joint-stock company, if such transactions do not pertain to major transactions
and their conduct does not pertain to the ordinary economic activities of the joint-stock company.
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
# CODE OF CORPORATE CONDUCT PROVISION OBSERVED OR NOTES
NOT OBSERVED
41 Presence in the joint-stock company’s internal documents of a procedure for agreement of operations Not observed.
that are outside the bounds of the financial and economic plan of the joint-stock company.
42 The absence in the membership of the joint-stock company’s executive bodies of persons who are Observed.
participants, the CEO (manager), a member of a management body, or a worker of a legal entity in
competition with the joint-stock company.
43 Absence in the membership of the joint-stock company’s executive bodies of persons who were Observed.
found guilty of crimes in the sphere of economic activity or crimes against the state, interests of state
service, and service in local government bodies or to whom administrative penalties were applied for
infractions in the field of finances, taxes and fees, and the securities market. If the functions of sole
executive body are performed by a management organization or manager – conformance of the CEO
and members of the administration of the managment organization or manager to demands made
on the CEO and members of the administration of the joint-stock company.
44 Presence in the joint-stock company’s articles of association or internal documents of a prohibition Not observed.
on the management organization (manager) from performing similar functions in a competing
company, as well as from having any other property relations with a joint-stock company, other than
rendering services of a management organization (manager).
45 Presence in the joint-stock company’s internal documents of the obligation of executive bodies to Not observed. This standard is not present in the Company’s internal documents; however, in accordance with the
refrain from actions that will lead or could potentially lead to a conflict between their interests and law “On joint-stock companies” (article 82), members of the Board of Directors are obligated to
the interests of the joint-stock company, and, in the event of such a conflict, to inform the board of notify the Company’s Board of Directors, the audit committee, and the auditor of information
directors of the same. concerning a conflict of interests and concerning transactions being conducted or planned in which
they might be found to be interested
46 Presence in the joint-stock company’s articles of association or internal documents of criteria for Not observed.
selecting a management organization (manager).
47 Submission by the joint-stock company’s executive bodies of monthly reports on their work to the Partially observed. Reports of the CEO on the Company’s activities are submitted to the Board of Directors on a quarterly
board of directors. basis.
48 Establishment in contracts concluded by the joint-stock company with the CEO/managing Observed. In accordance with Item 3.1.4 of the Provision Concerning the Administration,
organization/manager and members of the administration of responsibility for violation of provisions “members of the Administration shall bear responsibility to the Company for losses inflicted on the
concerning the use of confidential and proprietary information Company through their delinquent actions (inaction)…”.
In accordance with Item 5.1 of the Provision Concerning Insider Information, “for illegal
placement and/or use of insider information, Company insiders may be subjected to disciplinary
and/or civil liability in accordance with the terms of contracts with the Company and current
legislation, and to administrative and criminal liability in accordance with current legislation”.
| APPENDIXES
136 | 137
COMPANY SECRETARY
# CODE OF CORPORATE CONDUCT PROVISION OBSERVED OR NOTES
NOT OBSERVED
49 Presence in the joint-stock company of a specific official (the company secretary) whose task is to Observed. A corporate secretary works in the Company.
ensure the observation by joint-stock company bodies and officials of procedural requirements that
ensure that the rights and legal interests of the joint-stock company are fulfilled.
50 Presence in the joint-stock company’s articles of association or internal documents of a procedure for Observed. The Company’s internal documents (section 4, Provision Concerning the Administration; Section
appointment (election) of the company secretary and the duties of the company secretary. 4, Provision Concerning the Procedure for Convening and Holding Meetings of the Board of Directors,
Items 5.6. and 5.7. of the Provision Concerning the Procedure for Preparation and Holding of the
General Shareholders’ Meeting) contain the procedure for appointment and the obligations of the
secretaries of the respective executive bodies.
In accordance with the staff structure, the office of corporate secretary exists within the Company.
51 Presence in the joint-stock company’s articles of association of requirements for candidates for Not observed. Such requirements are not specified by the Articles of Association
company secretary.
SIGNIFICANT CORPORATE ACTIONS
# CODE OF CORPORATE CONDUCT PROVISION OBSERVED OR NOTES
NOT OBSERVED
52 Presence in the joint-stock company’s articles of association or internal documents of a requirement Not observed. The Articles of Association and internal documents of the Company contain no requirement for
for approval of a major transaction prior to conclusion thereof. approval of a major transaction prior to conclusion thereof.
53 Obligatory employment of an independent appraiser to appraise the market value of property Not observed.
constituting the subject of a major transaction.
54 Presence in the joint-stock company’s articles of association of a prohibition against undertaking, upon Not observed.
purchasing major share packages of the joint-stock company (acquisition), any actions aimed at
protecting the interests of executive bodies (members of such bodies) and members of the joint-stock
company’s board of directors, as well as actions that would worsen the situation of shareholders in
comparison with the existing situation (in particular, a prohibition against a decision by the board of
directors before the end of the proposed time for purchase of shares to issue additional shares,
securities converted to shares, or securities providing the right to purchase company shares, even if the
right to make such a decision is provided to the same by the articles of association).
55 Presence in the joint-stock company’s articles of association of a requirement for the obligatory Not observed. Company shares have been traded on the leading stock exchanges in Russia since 2006: NP RTS, JSC
employment of an independent appraiser to appraise the current market value of shares and possible RTS, and ZAO FB MICEX, where their current market value is determined.
changes in their market value due to the acquisition.
56 Absence in the joint-stock company’s articles of association of release of the purchaser from the Observed.
obligation to offer shareholders the option to sell ordinary company shares (issue securities
converted to ordinary shares) belonging to them upon acquisition.
57 Presence in the joint-stock company’s articles of association or internal documents of a requirement Not observed. This requirement is not specified in the articles of association or internal documents of the Company.
for obligatory employment of an independent appraiser to determine the share conversion ratio However, in practice, an independent appraiser has been employed to determine conversion ratios.
upon reorganization
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
INFORMATION DISCLOSURE
# CODE OF CORPORATE CONDUCT PROVISION OBSERVED OR NOTES
NOT OBSERVED
58 Presence of an internal document approved by the board of directors specifying the rules and Observed. The Provision Concerning Information Policy of JSC Sixth Wholesale Power Market Generating
approaches of the joint-stock company to information disclosure (Provision Concerning Information Company (approved by the 12.21.2006 Resolution of the Company’s Board of Directors, Protocol №
Policy). 29).
59 The presence in the joint-stock company’s internal documents of a requirement for information Not observed.
disclosure for the purposes of share placement, including major share packages, as well as whether
or not high joint-stock company officials will participate in purchasing company stock placed.
60 Presence in the joint-stock company’s internal documents of a list of information, documents, and Not observed. The complete list of information, documents, and materials provided to shareholders for resolution of
materials that must be provided to shareholders for resolution of issues presented to the general issues presented to the general shareholders’ meeting is not fixed in any of the Company’s internal
shareholders’ meeting. documents.
In accordance with Item 2.2 of the Provision Concerning Preparation and Holding of the
General Shareholders’ Meeting, in preparation for holding the General Shareholders’ Meeting, the
Board of Directors or, in the cases provided for by Paragraph 2 Item 2.1 of this Provision, other persons
shall make decisions regarding determination of the list of information provided to shareholders.
61 Presence of a joint-stock company Internet website and regular disclosure of information concerning Observed. Currently operating is the corporate website www.ogk6.ru
the joint-stock company on said website. In accordance with item 6.4 of the Provision Concerning Informational Policy the
Company shall publish information on its activities on the corporate website
62 Presence in the joint-stock company’s internal documents of a requirement for disclosure of Observed. In accordance with the Provision Concerning Information Policy the Company shall disclose
information concerning transactions of the joint-stock company with persons who are higher joint- Information on the corporate Internet site concerning ownership by higher officials and their
stock company officials in accordance with the articles of association, as well as concerning the joint- affiliates of shares in the Company and its subsidiaries and affiliates, with specification of the number
stock company’s transactions with organizations in which the joint-stock company’s higher officials and category/type of shares (item 5.2.8.2); Information concerning transactions between said
directly or indirectly own 20 percent or more of the authorized share capital of the joint-stock persons and the Company (Item 5.2.3.8).
company or which such persons may otherwise influence significantly.
63 Presence in the joint-stock company’s internal documents of a requirement for disclosure of Observed. Item 5.1 of the Provision Concerning Informational Policy (disclosure of information in a
information concerning all transactions that may have an influence on the market value of the joint- securities prospectus, quarterly report, and in the form of notices of significant facts).
stock company’s shares.
64 Presence of an internal document approved by the board of directors on the use of important Observed. The Provision Concerning Insider Information of JSC Sixth Wholesale Power Market Generating Company
information on the joint-stock company’s activities, the company’s shares and other securities, and (approved by the 05.25.2007 Resolution of the Company’s Board of Directors, Protocol № 40).
transactions with the same, which is not publicly available and the disclosure of which could have a
significant influence on the market value of the joint-stock company’s shares and other securities.
| APPENDIXES
138 | 139
CONTROL OF FINANCIAL AND ECONOMIC ACTIVITY
# CODE OF CORPORATE CONDUCT PROVISION OBSERVED OR NOTES
NOT OBSERVED
65 Presence of internal control procedures for the financial and economic activities of the joint-stock Observed. Control of observance of internal supervisory procedures of JSC “OGK-6” is exercised by the Internal
company, approved by the board of directors. Audit Board.
The Internal Audit Board was created in accordance with the Organizational Structure of the JSC
“OGK-6” executive office, approved by resolution of the Company’s Board of Directors (Protocol № 14
dated 02.15.2006)
The Provision Concerning the Internal Audit Board was approved by resolution of the Company’s
Board of Directors (Protocol № 44 dated 03.10.2007).
The internal supervision procedures are defined by the Provision (Article 3).
66 Presence of a special subdivision of the joint-stock company that ensures observance of internal Observed. An Internal Audit Board answerable to the Company CEO exists in the Company.
control (control and auditing service).
67 Presence in the joint-stock company’s internal documents of a requirement for determining the Not observed.
structure and membership of the joint-stock company’s control and auditing service by the board of
directors.
68 Absence in the membership of the joint-stock company’s control and auditing service of persons Observed.
who were found guilty of crimes in the sphere of economic activity or crimes against the state,
interests of state service, and service in local government bodies or to whom administrative penalties
were applied for infractions in the field of finances, taxes and fees, and the securities market.
69 Absence in the membership of the control and auditing service of persons who are members of Observed.
executive bodies of the joint-stock company, as well as of persons who are participants, the CEO
(manager), or members of administrative bodies or workers of a legal entity in competition with the
joint-stock company.
70 Presence in the joint-stock company’s internal documents of a date for submission to the control and Not observed.
auditing service of documents and materials for appraisal of the financial and economic operations
conducted, as well as of liability of joint-stock company officials and workers for their failure to
submit said documents and materials by the specified date.
71 Presence in the joint-stock company’s internal documents of the obligation of the control and Not observed.
auditing service to notify the audit committee or, in its absence, the joint-stock company’s board of
directors of discovered violations.
72 Presence in the joint-stock company’s articles of association of a requirement for preliminary Not observed
appraisal by the control and auditing service of the expediency of conducting operations not
provided for by the financial and economic plan of the joint-stock company (non-standard
operations).
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
# CODE OF CORPORATE CONDUCT PROVISION OBSERVED OR NOTES
NOT OBSERVED
73 Presence in the joint-stock company’s internal documents of a procedure of agreement of Observed. Approval of the following transactions is within the competence of the Board of Directors:
nonstandard operations with the board of directors. - in accordance with Sub-item 29 of Item 15.1 of the Articles of Association:
a) transactions related to uncompensated transfer of Company property or property rights
(requirements) to itself or a third party;
b) transactions related to release from property liability to itself or a third party;
c) transactions related to uncompensated provision of services (performance of tasks) by the
Company for third parties;
- in accordance with Sub-item 37 of Item 15.1 of the Articles of Association:
a) transactions the subjects of which are noncurrent Company assets in an amount greater than 10
percent of the book value of noncurrent Company assets as of the date of the decision to conduct
such a transaction;
c) transactions (including several interrelated transactions) the subject of which is property having a
value from 10 to 25 percent of the book value of the Company’s assets as of the date of the decision
to conclude such a transaction;
d) transactions (including several interrelated transactions) involving property constituting fixed
assets, intangible assets, and projects under construction purpose of which the is the generation,
transmission, dispatch, and placement of electric power and heat in the cases (amounts) specified
by individual decisions of the Company’s Board of Directors.
74 Presence of an internal document approved by the board of directors specifying the procedure for Observed. The Provision Concerning the Audit Committee, approved by the Board of Directors is in
conducting an audit of the joint-stock company’s financial and economic activities by the audit effecting the Company.
committee.
75 Performance of an appraisal of the audit report by the audit committee prior to submission thereof to Not observed. The audit committee of the JSC “OGK-6” Board of Directors was formed after the General
shareholders at the general shareholders’ meeting. Shareholders’ Meeting held on 06.29.2007.
DIVIDENDS
# CODE OF CORPORATE CONDUCT PROVISION OBSERVED OR NOTES
NOT OBSERVED
76 Presence of an internal document approved by the board of directors to which the board of directors Not observed. No provision concerning dividend policy is present.
conforms in adopting recommendations on the amount of dividends (Provision Concerning Dividend
Policy).
77 Presence in the Provision Concerning Dividend Policy of a procedure for determining the minimum Not observed
share of net profit of the joint-stock company to be directed towards payment of dividends and the
conditions under which dividends are not paid or not completely paid on preferred shares, the
amount dividends for which is specified in the joint-stock company’s articles of association.
78 Publishing of information on the joint-stock company’s dividend policy and amendments thereto in Partially observed. In accordance with the Provision Concerning Information Policy, information concerning the
a periodical publication provided for by the joint-stock company’s articles of association for Company’s dividend policy and amendments thereto is disclosed in a securities prospectus (item
publishing notices of general shareholders’ meetings, as well as posting of said information on the 5.1), on the company website, and within the annual report (items 5.2.6.6., 5.2.6.7.)
joint-stock company’s Internet website.
| APPENDIXES
140 | 141
III. INFORMATION ON MAJOR TRANSACTIONS AND RELATED PARTY TRANSACTIONS
CONCLUDED BY JSC “OGK-6” IN 2007
1. MAJOR TRANSACTIONS
# TRANSACTION NAME OF PARTY BENEFICIARIES VALUE APPROVED BY
1 Underwriting agreement, deposit Underwriting agreement: other persons to whom the provision based on the amounts of public offering of Annual General
agreement, and other agreements, JSC “OGK-6”; underwriting banks: Goldman Sachs concerning remuneration or ordinary shares in the Company and/or Shareholders’
transactions, and documents directly related International, Merrill Lynch International, and/or compensation of possible expenses, GDR, in an amount of not more than 1.95% Meeting (Protocol #5
to them or signed by JSC “OGK-6” in relation affiliated companies and other entities that could be costs, and losses extends under the of the sum of funds obtained, including dated 06.29.2007).
to the offer to Russian and foreign investors specified as underwriters in the Underwriting terms of the Agreement. additional bonuses and remuneration to the
of ordinary shares in JSC “OGK-6” and/or Agreement or in an appendix to the Underwriting Underwriters of expenses and costs, as well
global deposit notes verifying rights in Agreement. as VAT.
relation to ordinary shares in JSC “OGK-6”.
Deposit agreement: other persons to whom the provision Formed from all Company obligations as per
JSC “OGK-6”; underwriting banks: The Bank of New concerning remuneration or the Deposit Agreement, including those not
York, or Deutsche Bank Trust Company Americas, or compensation of possible expenses, limited by the value of the Company’s
JPMorgan Chase Bank, N.A., or other depositary bank costs, and losses extends under Deposit liabilities in relation to remuneration or
appointed by the Company. Agreement terms. compensation of possible expenses, costs,
and losses of the Depositary and other
persons to whom the provision concerning
remuneration or compensation of possible
expenses, costs, and losses extends under
Deposit Agreement terms
2 Contract of supply of a circulating fluidized JSC “OGK-6” (Purchaser) and JSC EMAlliance (Supplier). the value of supplied equipment and Board of Directors
bed boiler for a generation unit of JSC “OGK- fulfillment of accompanying labor (services) (Protocol #51 dated
6” subsidiary Novocherkasskaya GRES, as per the supply contract shall not be more 09.28.2007).
installed capacity 330 MW, and fulfillment of than 8,169,140 rubles 00 kopecks, including
accompanying work (services). 18% VAT – 1,246,140,000 rubles, 00
kopecks.
3 Underwriting agreement, deposit Underwriting agreement: other persons to whom the provision based on the amounts of public offering of Extraordinary General
agreement, and other agreements, JSC “OGK-6”; underwriting banks: Goldman Sachs concerning remuneration or ordinary shares in the Company and/or Shareholders’
transactions, and documents directly related International, Merrill Lynch International, and/or compensation of possible expenses, GDR, in an amount of not more than 1.95% Meeting (Protocol #7
to them or signed by JSC “OGK-6” in relation affiliated companies and other entities that could be costs, and losses extends under of the sum of funds obtained, including dated 11.07.2007).
to the offer to Russian and foreign investors specified as underwriters in the Underwriting Agreement terms. additional bonuses and remuneration to the
of ordinary shares in JSC “OGK-6” and/or Agreement or in an appendix to the Underwriting Underwriters of expenses and costs, as well
global deposit notes verifying rights in Agreement. as VAT.
relation to ordinary shares in JSC “OGK-6”,
including using a stabilization mechanism. Regulation S Deposit Agreement dated August other persons to whom the provision Formed from all Company obligations as per
14, 2007: JSC “OGK-6”, depositary bank Deutsche Bank concerning remuneration or the Regulation S Deposit Agreement,
Trust Company Americas (hereinafter the Depositary), compensation of possible expenses, including those not limited by the value of
and entities who at the respective time are the holders costs, and losses extends under the Company’s liabilities in relation to
and beneficial owners of global depositary notes as per Regulation S Deposit Agreement terms. remuneration or compensation of possible
Regulation S, verified by certificates of global expenses, costs, and losses of the Depositary
depositary notes issued in accordance with the and other persons to whom the provision
agreement terms. concerning remuneration or compensation
of possible expenses, costs, and losses
extends under Regulation S Deposit
Agreement terms.
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
# TRANSACTION NAME OF PARTY BENEFICIARIES VALUE APPROVED BY
Rule 144A Deposit Agreement dated August 14, other persons to whom the provision Formed from all Company obligations as per
2007 concerning remuneration or the Rule 144A Deposit Agreement,
JSC “OGK-6”, the Depositary, and entities that are compensation of possible expenses, including those not limited by the value of
currently the holders and beneficial owners of global costs, and losses extends under Rule the Company’s liabilities in relation to
depositary notes as per Rule 144A, verified by 144A Deposit Agreement terms. remuneration or compensation of possible
certificates of global depositary notes issued in expenses, costs, and losses of the Depositary
accordance with the agreement terms. and other persons to whom the provision
concerning remuneration or compensation
of possible expenses, costs, and losses
extends under Rule 144A Deposit
Agreement terms.
Loan agreement: JSC “OGK-6” (lender); Carbon The value (monetary valuation) of property
International Energy Limited (borrower). (services) that may be directly or indirectly
alienated (acquired) by the Company
(including the amount of the Company’s
obligations) as per the Loan Agreement is
formed from all of the Company’s
obligations as per the Loan Agreement,
including the obligation to provide a loan in
an amount of not more than 10% of the
value of GDR placed by investors, calculated
as per the placement price inclusive, and
loan interest at the rate of 0 to 10% per
annum (inclusive).
Option agreement: JSC “OGK-6”; Torman Limited. Formed from bonuses in an amount of not
more than 10,000 US dollars, payable by
the Company in favor of Torman Limited for
procurement of the right/option to purchase
up to 100% of placed shares in Carbon
International Energy Limited inclusive, up to
10,000 US dollars inclusive, which must be
paid by the Company to Torman Limited in
the event of exercise of the option by the
Company.
4 Agreement of output supply to the Generator: JSC “OGK-6”; The trade system administrator determines Extraordinary General
wholesale market. Unified Party: ZAO CFR, Administrator of the NP ATS the price (value) of the output according to Shareholders’
trade system. the procedure provided for by the Wholesale Meeting (Protocol # 8
Market Rules and the Contract of Accession dated 11.13.2007).
to the Wholesale Market System.
| APPENDIXES
142 | 143
2. RELATED-PARTY TRANSACTIONS
# TRANSACTION NAME OF RELATED VALUE # OF BOARD
PARTY PARTIES OF DIRECTORS
СДЕ PROTOCOL
1 Additional agreement to agency contract JSC “OGK-6”(Principal), JSC RAO UES of Russia. #31 dated
Definition of fair value and definition of replacement value of assets belonging to the JSC RAO UES of Russia (Agent). 02.15.2007.
Principal.
2 Agreement of services for the development of an Insurance Coverage Program for JSC “OGK-6” (Customer); JSC RAO UES of Russia 150,000 rubles 00 kopecks, #36 dated
members of the Administration and members of the Board of Directors. JSC IB Elektra (Contractor). including VAT. 04.09.2007.
3 Purchase and sale agreement for electricpower according to which no confirmation of the JSC “OGK-6”; JSC RAO UES of Russia, member Determined by calculation. #39 dated
absence of significant system limitations is required. JSC Mosenergosbyt (sale). of the JSC “OGK-6” Board of 05.07.2007.
Directors S.S. Fil.
4 Agreement on performance of installation and debugging work in JSC “OGK-6” subsidiary JSC “OGK-6” (Customer); JSC RAO UES of Russia. 177,000 rubles 00 kopecks, #39 dated
Krasnoyarskaya GRES-2 of the SQL version of the BING-3 information and diagnostic JSC NIIES (Contractor). including 18% VAT. 05.07.2007.
system.
5 Agreement for attestation of subdivisions of JSC “OGK-6” subsidiary Krasnoyarskaya JSC “OGK-6” (Customer); JSC RAO UES of Russia. 198,240 rubles 00 kopecks, #39 dated
GRES-2 that conduct quantitative chemical analyses. JSC UES Engineering Center including 18% VAT. 05.07.2007.
(Contractor).
6 Agreement on development of an FS for reconstruction of generation unit № 6 of JSC JSC “OGK-6” (Customer); JSC RAO UES of Russia. 370,100,000 rubles 00 kopecks, #41 dated
“OGK-6” subsidiary Kirishskaya GRES on the basis of a combined cycle plant . JSC SevZap NTC (Contractor). including 18% VAT in the amount 06.21.2007.
of 56,455,932 rubles 20 kopecks.
7 Agreement on development of design estimates for reconstruction of generation unit № JSC “OGK-6”(Customer); JSC RAO UES of Russia. 450,000,000 rubles 00 kopecks, #41 dated
6 of JSC “OGK-6” subsidiary Kirishskaya GRES on the basis of a combined cycle plant. JSC SevZap NTC (Contractor). including 18% VAT in the amount 06.21.2007.
of 68,644,067 rubles 80 kopecks.
8 Agreement on development of design estimates for the project “Addition of a gas turbine JSC “OGK-6”(Customer); JSC RAO UES of Russia. 267,559,100 rubles 00 kopecks, #41 dated
to the 310 MW steam generation unit of JSC “OGK-6” subsidiary GRES-24. JSC UES Engineering Center including 18% VAT in the amount 06.21.2007.
(Contractor). of 40,814,100 rubles 00 kopecks.
9 Additional agreement to the agent agreement for conclusion of work agreements for the JSC “OGK-6” (Principal), JSC RAO UES of Russia The bonus of Non-profit #41 dated
creation of a normative base of technical regulations in the electric power industry with Non-profit Partnership Partnership Innovations in the 06.21.2007.
contractor companies; holding of tenders Innovations in the Electric Power Electric Power Industry as per
Industry (Agent). agent agreement comprises
10% of the sum of the
agreements concluded by the
Agent, specifically 2,764,184
rubles 60 kop., including VAT.
10 Additional agreement to the agent agreement for conclusion of work agreements for the JSC “OGK-6” (Principal), Non- JSC RAO UES of Russia. #41 dated
development of legal, normative and technical, and practical documents on financial and profit Partnership Innovations in 06.21.2007.
economical aspects of environmental protection with contracting companies. the Electric Power Industry
(Agent).
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
# TRANSACTION NAME OF RELATED VALUE # OF BOARD
PARTY PARTIES OF DIRECTORS
СДЕ PROTOCOL
11 Agreement for performance by JSC Ural Electric Power Industry Engineering Center of JSC “OGK-6” (Customer); JSC JSC RAO UES of Russia. 232,287 rubles 00 kopecks, #42 dated
thermal tests of generators at generation units Nos. 5, 6, 7 of JSC “OGK-6” subsidiary Ural Electric Power Industry including 18% VAT. 06.28.2007.
Krasnoyarskaya GRES-2. Engineering Center (Contractor).
12 Agreement on development by JSC Siberian ENTC of a plan for liquidation of accidents at JSC “OGK-6” (Customer); JSC RAO UES of Russia. 1,156,400 rubles 00 kopecks, #42 dated
hydrotechnical installations of JSC“OGK-6”subsidiary Krasnoyarskaya GRES-2 and calculation of JSC Siberian ENTC (Contractor). including 18% VAT. 06.28.2007.
the harm which may be inflicted due to accidents at hydrotechnical installations.
13 Agreement on performance by JSC VTI of work on steam-oxygen cleansing, passivization, JSC “OGK-6” (Customer); JSC RAO UES of Russia. 330,400 rubles 00 kopecks, #42 dated
and conservation of generation unit № 7 with PK-31 boilers and a K-150-130 turbine of JSC VTI (Contractor). including 18% VAT. 06.28.2007.
JSC “OGK-6” subsidiary Krasnoyarskaya GRES-2.
14 Agreement of paid services of analyses conducted by JSC UES Engineering Center of JSC “OGK-6” (Customer); JSC RAO UES of Russia. 59,000 rubles 00 kopecks, #42 dated
calculations and agreement of capacity limitations and measures for reduction thereof of JSC UES Engineering Center including 18% VAT. 06.28.2007.
JSC “OGK-6” subsidiary Kirishskaya GRES planned for 2008. (Contractor).
15 Agreement on development by JSC South ECE of design estimates for construction of JSC “OGK-6”; JSC South ECE. JSC RAO UES of Russia. #43 dated
generation unit № 9 of JSC “OGK-6” subsidiary Novocherkasskaya GRES using CCS 07.12.2007.
technology.
16 Agreement on fulfillment by JSC CKB Energoremont of work to determine the cost of repairing JSC “OGK-6”(Customer); JSC RAO UES of Russia. 2,950,000 rubles 00 kopecks, #44 dated
fixed assets of JSC “OGK-6” subsidiaries Ryazanskaya GRES, Novocherkasskaya GRES, JSC CKB Energoremont including 18% VAT. 08.10.2007.
Kirishskaya GRES, Krasnoyarskaya GRES-2, Cherepovetskaya GRES, and GRES-2 for 2008. (Contractor).
17 Agreement on performance by JSC Power Machines of technical management of capital JSC “OGK-6” (Customer); JSC RAO UES of Russia. 351,252 rubles 40 kopecks, #44 dated
repairs of PT-60-130/13 steam turbines of plant №2T and K-300-240 of plant №2 of JSC JSC Power Machines including 18% VAT. 08.10.2007.
“OGK-6” subsidiary Kirishskaya GRES. (Contractor).
18 Agreement on performance by JSC VTI of thermal reconstruction of high-pressure fitting JSC “OGK-6” (Customer); JSC RAO UES of Russia. 584,100 rubles 00 kopecks, #44 dated
housings of JSC “OGK-6” subsidiary Krasnoyarskaya GRES-2 JSC VTI (Contractor). including 18% VAT. 08.10.2007.
19 Agreement on development by JSC Siberia ENTC of a Declaration of Safety of the JSC “OGK-6” (Customer); JSC RAO UES of Russia 814,200 rubles 00 kopecks, #44 dated
hydrotechnical installations of JSC “OGK-6” subsidiary Krasnoyarskaya GRES-2. JSC Siberian ENTC (Contractor). including 18% VAT. 08.10.2007.
20 Agreement on development by JSC UES Engineering Center of a substantiation of JSC“OGK-6” (Customer); JSC RAO UES of Russia. 49,090,841 rubles 00 kopecks, #44 dated
investments in the project “Second-phase construction of Cherepovetskaya GRES with JSC UES Engineering Center including 18% VAT in the 08.10.2007.
allocation of generation unit № 4 as primary startup complex”. (Contractor). amount of 7,488,433 rubles
37 kopecks.
21 Agreement on performance by JSC Ural Engineering Center of the Electric Power Industry JSC “OGK-6” (Customer); JSC RAO UES of Russia. 1,203,607 rubles 65 kopecks, #44 dated
of an audit of the design estimates for construction of generation unit № 9 of JSC “OGK-6” JSC Ural Electric Power Industry including 18% VAT in the amount 08.10.2007.
subsidiary Novocherkasskaya GRES using CCS technology. Engineering Center (Contractor). of 183,601 rubles 43 kopecks.
22 Agreement for conducting by JSC VTI of an audit of substantiation of investments for the JSC “OGK-6” (Customer); JSC RAO UES of Russia. 1,020,000 rubles 00 kopecks, #44 dated
project “Modernization of GRES-24 through addition to a 310 MWt unit of a GT-110 gas JSC VTI (Contractor). including 18% VAT in the amount 08.10.2007.
turbine”. of 155,593 rubles 22 kopecks.
23 Agreement on performance of project tasks (development of projects for “Administrative JSC “OGK-6” (Customer); JSC RAO UES of Russia. 15,667,526 rubles 70 kopecks, #47 dated
and municipal building”, “Reconstruction of the lime industry building”) executed by JSC JSC South ECE (Contractor). including 18% VAT. 09.14.2007.
South ECE.
24 Agreement on performance of work by JSC ENIN to calculate standard numbers of JSC JSC “OGK-6” (Customer); JSC RAO UES of Russia. 755,200 rubles 00 kopecks, #49 dated
“OGK-6” personnel. JSC ENIN (Contractor). including 18% VAT. 09.24.2007.
| APPENDIXES
144 | 145
25 Contract agreement for performance by JSC FSK UES of a technical survey of the contour JSC “OGK-6” (Customer); JSC RAO UES of Russia. 613,483 rubles 71 kopecks, #49 dated
of the grounding of OS 110, 330 kW, of JSC “OGK-6” subsidiary Kirishskaya GRES. JSC FSK UES (Contractor). including 18% VAT. 09.24.2007.
26 Contract agreement for performance by JSC UES Engineering Center of work on technical JSC “OGK-6” (Customer); JSC RAO UES of Russia. 613,600 rubles 00 kopecks, #49 dated
diagnostics and survey of reinforced concrete and metal structures of crane tracks and JSC UES Engineering Center including 18% VAT. 09.24.2007.
columns of crane trestles, rows G1 and D of the main building of the CPP of JSC “OGK-6” (Contractor).
subsidiary Kirishskaya GRES.
27 Contract agreement for performance by JSC UES Engineering Center of work on technical JSC “OGK-6” (Customer); JSC RAO UES of Russia. 472,000 rubles 00 kopecks, №49 dated
diagnostics and survey of reinforced concrete and metal structures of crane tracks and JSC UES Engineering Center including 18% VAT. 09.24.2007.
columns of crane trestles, rows G1 and D of the main building of the TPP of JSC “OGK-6” (Contractor).
subsidiary Kirishskaya GRES.
28 Agreement for performance by JSC VTI of work on a survey of high-pressure hoses on PK- JSC “OGK-6”(Customer); JSC RAO UES of Russia. 424,800 rubles 00 kopecks, #49 dated
38 boilers of generation units Nos. 1, 2, and 4 of JSC “OGK-6” subsidiary Krasnoyarskaya JSC VTI (Contractor). including 18% VAT. 09.24.2007.
GRES-2 to determine the possibility, time, and conditions for further operation.
29 Agreement for performance by JSC VTI of work on the survey of first-category mains of JSC “OGK-6” (Customer); JSC RAO UES of Russia. 413,000 rubles 00 kopecks, #49 dated
generation units of plants № 9 and № 10 of JSC “OGK-6” subsidiary Krasnoyarskaya JSC VTI (Contractor). including 18% VAT. 09.24.2007.
GRES-2 to determine the possibility, time, and conditions for further operation.
30 Agreement for performance by JSC VTI of calculations of the economic life of trunk main JSC “OGK-6” (Customer); JSC RAO UES of Russia. 145,140 rubles 00 kopecks, #49 dated
pipeline elements operating in creep flow conditions, of JSC “OGK-6” subsidiary JSC VTI (Contractor). including 18% VAT. 09.24.2007.
Krasnoyarskaya GRES-2.
31 Contract agreement for performance by JSC UES Engineering Center of work to determine JSC “OGK-6” (Customer); JSC RAO UES of Russia. 354,000 rubles 00 kopecks, #49 dated
the technical status of gas outlet trunk № 1 of reinforced concrete smokestack № 5 JSC UES Engineering Center including 18% VAT. 09.24.2007.
(H=320 m) of JSC “OGK-6” subsidiary Kirishskaya GRES. (Contractor).
32 Agreement for performance by JSC SibENTC of adjustment of detail design “Buildup of JSC “OGK-6” (Customer); JSC RAO UES of Russia. 6,136,000 rubles 00 kopecks, #49 dated
tier 4 of the existing ash dump” of JSC “OGK-6” subsidiary Krasnoyarskaya GRES-2. JSC SibENTC (Contractor). including 18% VAT. 09.24.2007.
33 Agreement for performance by JSC SibENTC of work on certification of masonry and JSC “OGK-6” (Customer); JSC RAO UES of Russia. 289,000 rubles 00 kopecks, #49 dated
thermal insulation of trunk mains, boilers, and turbines of the generation units of the JSC SibENTC (Contractor). including 18% VAT. 09.24.2007.
plant #2 of JSC “OGK-6” subsidiary Krasnoyarskaya GRES-2.
34 Agreement for performance of work to adjust automatic optimum voltage differential JSC “OGK-6” (Customer); JSC RAO UES of Russia. 1,770,000 rubles 00 kopecks, №49 dated
control systems at the OR of generation unit № 4 of JSC “OGK-6” subsidiary JSC UES Engineering Center including 18% VAT. 09.24.2007.
Novocherkasskaya GRES. (Contractor).
35 Agreement for performance of thermal tests of turbines with development of normative JSC “OGK-6”(Customer); JSC RAO UES of Russia. 8,839,801 rubles 89 kopecks, #49 dated
characteristics of units Nos. 1, 2, 3, 4, 5, 7, and 8 of JSC “OGK-6” subsidiary South ECE (Contractor). including 18% VAT. 09.24.2007.
Novocherkasskaya GRES.
36 Additional agreement to agreement № 0500856/060263-0622/456-06 dated JSC “OGK-6”; JSC RAO UES of Russia. 18,314,401 rubles 22 kopecks, #49 dated
07.05.2006 for performance of an audit of rotor TVV-320-2UZ (fac. №16280) with JSC Power Machines. including 18% VAT. 09.24.2007.
simultaneous replacement of the radial fan concluded between JSC KiGRES, the full
cessionary of the property, rights, and obligations of which is JSC “OGK-6”, and JSC Power
Machines.
37 Agreement on paid services to provide scientific and technical industrial documents. JSC “OGK-6” (Customer); JSC RAO UES of Russia. not more than 198,000 rubles #49 dated
JSC VTI (Contractor). 00 kopecks, including 18% VAT. 09.24.2007.
38 Agreements for development and furnishing processes (product sheets) by type of repair JSC “OGK-6” (Customer); JSC RAO UES of Russia. 1,797,700 rubles 00 kopecks, #49 dated
of primary and ancillary equipment of JSC “OGK-6”. JSC CKB Energoremont including 18% VAT. 09.24.2007.
(Contractor).
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
# TRANSACTION NAME OF RELATED VALUE # OF BOARD
PARTY PARTIES OF DIRECTORS
СДЕ PROTOCOL
39 Agreement on supply of graphic products (industrial normative and information JSC “OGK-6”(Purchaser); JSC RAO UES of Russia. not more than 188,800 rubles #49 dated
documentation) JSC UES Engineering Center 00 kopecks, including 18% VAT. 09.24.2007.
(Supplier).
40 Agreement with captive insurance agency JSC IB Elektra. JSC “OGK-6”; JSC IB Elektra. JSC RAO UES of Russia. 50,000 rubles 00 kopecks, #53 dated
including 18% VAT. 11.06.2007.
41 Guarantee agreement JSC “OGK-6”(Creditor) JSC RAO UES of Russia, member #53 dated
The extent of claims of JSC “OGK-6” (the Creditor) against JSC Kostromsky Sales Company and JSC TGK-2 (Guarantor). of the JSC “OGK-6” Board of 11.06.2007.
(the Debtor), which may be put to JSC TGK-2 (the Guarantor) as per the guarantee Directors D.A. Melnikov.
agreement concluded between the Creditor and the Debtor, in an amount of not more than
95% of obligations of the Debtor as per regulated purchase and sale contracts of electric
power and output Nos.RDM-PKOSTREN-SKRASGR1-01-KP-07-L and RDM-PKOSTREN-
SKRASGR2-01-KP-07-L dated 02.16.07, concluded between the Creditor and the Debtor, for
the accounting period (without account of fines and penalties accrued against the sum of
the arrears of the Debtor) and not more than 2% of the book value of assets of the Guarantor
as of the last accounting date for the entire life of the guarantee agreement.
42 Guarantee agreement JSC “OGK-6” (Creditor) JSC RAO UES of Russia, member #53 dated
The extent of claims of JSC “OGK-6” (the Creditor) against JSC Arkhenergosbyt (the Debtor), and JSC TGK-2 (Guarantor). of the JSC “OGK-6” Board of 11.06.2007.
which may be put to JSC TGK-2 (the Guarantor) as per the guarantee agreement concluded Directors D.A. Melnikov.
between the Creditor and the Debtor, in an amount of not more than 95% of obligations of
the Debtor as per regulated purchase and sale contracts of electric power and output Nos.
RDM-PARHENER-SVOLOGE1-02-KP-07-E and RDM-PARHENER-SMOLEN21-01-KP-07-E
dated 02.16.07, concluded between the Creditor and the Debtor, for the accounting period
(without consideration of fines and penalties accrued against the sum of the arrears of the
Debtor) and not more than 2% of the book value of assets of the Guarantor as of the last
accounting date for the entire life of the guarantee agreement.
43 Guarantee agreement JSC “OGK-6” (the Creditor) JSC RAO UES of Russia, member Accrued on the sub of arrears of #53 dated
The extent of claims of JSC “OGK-6” (the Creditor) against JSC Omsk Energy Sales and JSC Omsk Energy Sales of the JSC “OGK-6” Board of the Debtor and not more than 11.06.2007.
Company (the Debtor), which may be put to JSC Omsk Energy Sales Company (the Company (the Guarantor). Directors P.O. Shatsky. 2% of the book value of assets
Guarantor) as per the guarantee agreement concluded between the Creditor and the of the Guarantor.
Guarantor in an amount of not more than 95% of obligations of the Debtor as per the
purchase and sale contract of electric power and output № 34346 (03.212.288.07) dated
02.16.2007, concluded between the Creditor and the Debtor, for the accounting period
(without account for fines and penalties).
44 Additional agreement № 05030856/050097-0447/335-05 dated 02.24.2005 to perform JSC “OGK-6”; JSC RAO UES of Russia. 12,676,791 rubles 78 kopecks, #53 dated
flaw detection (technical examination) and repair of the rotor of low-voltage steam turbine JSC Power Machines. including 18% VAT. 11.06.2007.
K-300-240-1 fac. №1186, concluded previously between JSC KiGRES, the full cessionary of
the property, rights, and obligations of which is JSC “OGK-6”, and JSC Power Machines.
45 Agreement on performance by JSC UES Engineering Center of work on the accreditation JSC “OGK-6” (the Customer); JSC RAO UES of Russia. 127,440 rubles 00 kopecks, #53 dated
of the meteorological service of JSC “OGK-6”subsidiary Kirishskaya GRES to the right to JSC UES Engineering Center (the including 18% VAT. 11.06.2007.
conduct calibration work on six types of measurements. Contractor).
46 Agreement of paid services of JSC Ural Engineering Center of the Electric Power Industry JSC “OGK-6”(Customer); JSC RAO UES of Russia. 310,000 rubles 00 kopecks, #53 dated
for compilation of a thermal masonry passport and thermal insulation of 310 MW unit of JSC Ural Electric Power Industry including 18% VAT. 11.06.2007.
JSC “OGK-6” subsidiary GRES-24. Engineering Center (Contractor).
| APPENDIXES
146 | 147
47 Agreement on provision to JSC “OGK-6” subsidiary Kirishskaya GRES of graphic products JSC “OGK-6” (the Purchaser); JSC RAO UES of Russia. not more than 100,000 rubles #53 dated
— the industrial normative and informational documents published by JSC UES JSC UES Engineering Center (the 00 kopecks, including 18% VAT. 11.06.2007.
Engineering Center. Supplier).
48 Contractor’s agreement for performance by JSC VTI of an investigation of the condition of JSC “OGK-6” (Customer); JSC RAO UES of Russia. 230,832 rubles 84 kopecks, #53 dated
metal and determination of the possibility and times for subsequent operation of isolation SC VTI (Contractor). including 18% VAT. 11.06.2007.
valves of turbine K-300-240 of a unit of plant №2 of JSC “OGK-6” Kirishskaya GRES.
49 Agreement on supply of services from NP INVEL to provide JSC “OGK-6” with the right of JSC “OGK-6” the (Customer); JSC RAO UES of Russia. 307,400 rubles 00 kopecks, #53 dated
access to the set of legal, normative and technical, and guidance documents for the JSC INVEL (the Contractor). including 18% VAT. 11.069.2007.
technical and financial and economic aspects of environmental protection.
50 Agreement on performance by JSC UES Engineering Center of work to draw up a report JSC “OGK-6” (Customer); JSC RAO UES of Russia #53 dated
on the results of check tests of availability for participation in total primary frequency JSC UES Engineering Center 29,500 rubles 00 kopecks, 11.06.2007.
control in the UES of generation units of plants Nos. 9 and 10 of JSC “OGK-6” subsidiary (Contractor). including 18% VAT.
Krasnoyarskaya GRES-2.
51 Agreement on performance by JSC “OGK-6” of steam-oxygen passivation of boiler BKZ- JSC Enesei TGK (TGK-13) (the JSC RAO UES of Russia, member 127,741 rubles 47 kopecks, #53 dated
420-140-PT2 of plant № 1 of JSC Enesei TGK (TGK-13) subsidiary Minusinsky TPP, as well Customer) and JSC “OGK-6” (the of the JSC “OGK-6” Board of including 18% VAT. 11.06.2007.
as servicing the installation of a transportation reservoir of liquid oxygen during steam- Contractor). Directors P.O. Shatsky.
oxygen passivation of boiler BKZ-420-140 PT-2 plant № 1 of Enesei TGK (TGK-13)
subsidiary Minusinsky TPP.
52 Work agreement for the remarking the equipment of JSC “OGK-6” subsidiary JSC “OGK-6” (Customer); JSC JSC RAO UES of Russia #53 dated
Krasnoyarskaya GRES-2. UES Engineering Center 23,600 rubles 00 kopecks, 11.06.2007.
(Contractor). including 18% VAT.
53 Agreement on performance by JSC RAO UES of Russia of information servicing of JSC JSC “OGK-6” (Customer); JSC RAO UES of Russia, member 42,000 rubles 00 kopecks, #55 dated
“OGK-6” by supporting access to an individual program of pre-examination preparation JSC RAO UES of Russia of the JSC “OGK-6” Board of including 18% VAT. 12.04.2007.
of specialists and the related electronic copies of documents located on WWW servers of (Contractor). Directors S. Remes
JSC RAO UES of Russia subsidiaries DP Tsentrenergotekhnadzor via the Internet
54 Agreement . JSC “OGK-6”; Non-profit JSC RAO UES of Russia, member #55 dated
Partnership Energy Carbon of the JSC “OGK-6” Board of 12.04.2007
Fund; JSC Energy carbon Directors D.A. Burnashev.
products.
55 Agreement on performance by JSC VTI of repair of OP-2-110 (CEN) impellers by means JSC “OGK-6”(Customer); JSC RAO UES of Russia. 236,000 rubles 00 kopecks, #55 dated
of electrospark covering of the work surface subjected to wear of axle pump assemblies JSC VTI (Contractor). including 18% VAT. 12.04.2007.
of unit № 7 of inv. №16208 of JSC “OGK-6” subsidiary Krasnoyarskaya GRES-2.
56 Agreement on performance by JSC UES Engineering Center of work to draw up a report JSC “OGK-6” (Customer); JSC RAO UES of Russia. 29,500 rubles 00 kopecks, #55 dated
on the results of check tests of availability for participation in total primary frequency JSC UES Engineering Center including 18% VAT. 12.04.2007.
control in the UES of generation units of plant №5 of JSC “OGK-6” subsidiary (Contractor).
Krasnoyarskaya GRES-2.
57 Agreement on participation of an JSC “OGK-6” representative in the fourth international JSC “OGK-6” (Customer); JSC RAO UES of Russia. 15,000 rubles 00 kopecks, #55 dated
science and technology conference, “The Issue of Vibration, Vibration Adjustment, JSC VTI (Contractor). including 18% VAT. 12.04.2007.
Vibration Monitoring, and PP Equipment Diagnostics”, held by JSC VTI.
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
# TRANSACTION NAME OF RELATED VALUE # OF BOARD
PARTY PARTIES OF DIRECTORS
СДЕ PROTOCOL
58 Transaction related to the Company’s participation in NP VTI. JSC RAO UES of Russia, Amount of introductory deposit #56 dated
(Performance of the necessary actions related to establishment of NP VTI along with JSC members of the Board of related to the Company’s 12.17.2007.
RAO UES of Russia, JSC VTI, JSC TGK-1, JSC TGK-2, JSC Mosenergo, JSC TGK-4, JSC TGK-5, Directors of JSC “OGK-6” D.A. participation in NP VTI –
JSC TGK-6, JSC TGK-7, JSC South Generating Company – TGK-8, JSC TGK-9, JSC TRGK, JSC Burnashev, A.V. Evkharitsky, D.A. 52,365.6 thousand rubles.
TGK-11, JSC TGK-12, JSC OGK-1, JSC OGK-2, JSC OGK-3, JSC OGK-4, JSC OGK-5, JSC UES Melnikov, S. Remes, M.Z.
Engineering Center, JSC Ural Engineering Center of the Power Industry, JSC Siberian Sokolovsky, S.S. Fil, I.G. Tsurnov,
ENTC, JSC South Engineering Center of the Power Industry, JSC Povolzhia Engineering P.O. Shatsky.
Center for the Power Industry, JSC VNIPI Energoprom, JSC SKB VTI, JSC SPKBRR, JSC CKB
Energoremont, JSC Sibtekhenergo, JSC SevZap NTC).
59 Owner/developer service agreement for project “Modernization of GRES-24 through JSC “OGK-6”(Customer); JSC RAO UES of Russia. Payment for service: 119,605,000 #56 dated
addition of a gas turbine to the 310 MW unit ”. JSC UES Engineering Center rubles, incl. 18% VAT – 12.17.2007.
(Contractor). 18,244,830.51 rubles. The
premium from savings on project
implementation is paid by the
Customer within 1 (one) month
following the date of putting the
facility in guarantee commission
in the amount of 50% of the
difference between the indicative
price and all expenses actually
incurred by the Customer related
to implementation of the project,
but not more than 430,000,000
rubles, incl. 18% VAT —
65,593,220.34 rubles.
60 Agreement on paid services to adjust the recharger following replacement of VAZP at UZP JSC “OGK-6” (Customer); JSC RAO UES of Russia. 235,498 rubles 50 kopecks, #56 dated
(inv. № 43777) and accession to the BSPT scheme of JSC “OGK-6” subsidiary JSC South ECE (Contractor). including 18% VAT. 12.17.2007.
Novocherkasskaya GRES.
61 Agreement of services of conducting analyses and agreement of time schedules of cold JSC “OGK-6”(Customer); JSC RAO UES of Russia. 323,662 rubles 20 kopecks, #59 dated
startup of generation units Nos. 1-4 of JSC “OGK-6” subsidiary Ryazanskaya GRES. JSC UES Engineering Center including 18% VAT. 12.27.2007.
(Contractor).
62 Service agreement for technical certification of buildings and installations of JSC “OGK-6” JSC “OGK-6” (Customer); JSC RAO UES of Russia. 1,852,600 rubles 00 kopecks, #59 dated
subsidiary Ryazanskaya GRES. JSC UES Engineering Center including 18% VAT. 12.27.2007.
(Contractor).
63 Service agreement for comprehensive inspection of galleries and trestles of JSC “OGK-6” JSC “OGK-6” (Customer); JSC RAO UES of Russia. 885,000 rubles 00 kopecks, #59 dated
subsidiary Ryazanskaya GRES . JSC UES Engineering Center including 18% VAT. 12.27.2007.
(Contractor).
64 Work agreement for analysis and submission of proposals for organizing labor and rating JSC “OGK-6” (Customer); JSC RAO UES of Russia. 224,200 rubles 00 kopecks, #59 dated
of the work of personnel of the boiler-and-turbine workshop of JSC “OGK-6” subsidiary JSC ENIN (Contractor). including 18% VAT. 12.27.2007.
Krasnoyarskaya GRES-2.
65 Work agreement of JSC FSK UES for repair of overhead VVD-330B breakers VLB-4, VT-5, JSC “OGK-6” (Customer); JSC RAO UES of Russia. 3,555,753 rubles 85 kopecks, #59 dated
and VLB-6 of JSC “OGK-6” subsidiary Kirishskaya GRES. JSC FSK UES (Contractor). including 18% VAT. 12.27.2007.
66 Work agreement of JSC FSK UES for capital repair of overhead VVU-110 breakers VlKrsh- JSC “OGK-6” (Customer); JSC RAO UES of Russia. 2,005,130 rubles 91 kopecks, #59 dated
2, SV-1, SV-2 (MSB-2), BlKNPZ-1) of JSC “OGK-6” subsidiary Kirishskaya GRES. JSC FSK UES (Contractor). including 18% VAT. 12.27.2007.
| APPENDIXES
148 | 149
IV. JSC “OGK-6” PRIMARY EQUIPMENT CHARACTERISTICS
TABLE #1. TURBINES
PLANT # TURBINE TYPE (GRADE) MANUFACTURERYEAR COMMISSIONED INSTALLED ELECTRICAL CAPACITY THERMAL CAPACITY
MW Gcal/hr
Ryazanskaya GRES 2,650 120
TPB 01 К-300-240 LMZ 1973 260 15
TPB 02 К-300-240 LMZ 1973 270 15
TPB 03 К-300-240 LMZ 1974 260 15
TPB 04 К-300-240 LMZ 1974 260 15
TPB 05 К-800-240-3 LMZ 1980 800 30
TPB 06 К-800-240-3 LMZ 1981 800 30
Novocherkasskaya GRES 2,112 75
TPB 01 К-264(300)-240-1 KTGZ 1965 264 15
TPB 02 К-264(300)-240-2 KTGZ 1966 264 15
TPB 03 К-264(300)-240-2 KTGZ 1967 264 15
TPB 04 К-264(300)-240-2 KTGZ 1968 264 15
TPB 05 К-264(300)-240-2 KTGZ 1969 264 0
TPB 06 К-310-23,5-3 KTGZ 2005 264 0
TPB 07 К-264(300)-240-2 KTGZ 1971 264 0
TPB 08 К-264(300)-240-2 KTGZ 1972 264 15
Kirishskaya GRES 2,100 826
TPB 01 К-300-240-1 LMZ 1969 300 0
TPB 02 К-300-240-1 LMZ 1970 300 0
TPB 03 К-300-240-1 LMZ 1970 300 0
TPB 04 К-300-240-1 LMZ 1971 300 0
TPB 05 К-300-240-1 LMZ 1973 300 0
TPB 06 К-300-240-1 LMZ 1975 300 0
TP 01Т PT-50-130/7 ТМЗ 1965 50 110
TP 02Т PT-60-130/13 LMZ 1966 60 139
TP 03Т PT-50-130/7 ТМЗ 1967 50 110
TP 04Т PT-60-130/13 LMZ 1975 60 139
TP 05Т Р-40-130/13 LMZ 1976 40 164
TP 06Т Р-40-130/19 LMZ 1979 40 164
Krasnoyarskaya GRES-2 1,250 976
TG-1 К-150-130 KTGZ 1961 150 45
TG-2 К-150-130 KTGZ 1962 150 45
TG-4 К-150-130 KTGZ 1963 150 45
TG-5 PT-60-90/13 LMZ 1964 50 145
TG-6 К-160-130 KTGZ 1974 160 42
TG-7 К-160-130 KTGZ 1975 160 42
TG-8 К-160-130 KTGZ 1976 160 42
TG-9 PT-135/165-130-15 UTMZ 1981 135 285
TG-10 PT-135/165-130-15 UTMZ 1983 135 285
Cherepovetskaya GRES 630 39
TPB 01 К-210-130-3 LMZ 1976 210 13
TPB 02 К-210-130-3 LMZ 1977 210 13
TPB 03 К-210-130-3 LMZ 1978 210 13
GRES-24 310 0
TBP 01 K-300-240-4 LMZ 1988 310 0
LMZ — Leningrad Metal Factory, Power Machines, KTGZ — Kharkov Turboelectric Factory, NPO Turboatom, UTMZ — Ural Turbomotor Factory.
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
TABLE #2. POWER BOILERS
BOILER | BOILER TYPE (GRADE) | MFR. | YEAR COMM. | LIVE STEAM PARAMETERS | OUTPUT | FUEL
FOR KINDLING/
PRESSURE TEMP PRIMARY RESERVE LIGHTING DESIGN
kgf/cm2 °С T/hr
Ryazanskaya GRES
KPB 01 PP-860-255-545 ZIO 1973 255 545 860 Coal – Gas, Fuel Oil Coal
KPB 02 PP-890-255-545 ZIO 1973 255 545 890 Coal – Gas, Fuel Oil Coal
KPB 03 PP-860-255-545 ZIO 1974 255 545 860 Coal – Gas, Fuel Oil Coal
KPB 04 PP-860-255-545 ZIO 1974 255 545 860 Coal – Gas, Fuel Oil Coal
KPB 05 TGMP-204P TKZ 1980 255 545 2,650 Gas Fuel oil Gas, Fuel Oil Fuel oil
KPB 06 TGMP-204P TKZ 1981 255 545 2,650 Gas Fuel oil Gas, Fuel Oil Fuel oil
Novocherkasskaya GRES
KPB 01 TRP-110 TKZ 1965 255 545 830 Gas Coal Gas, Fuel Oil Coal
KPB 02 TRP-110 TKZ 1966 255 545 830 Coal Gas Gas, Fuel Oil Coal
KPB 03A TRP-210 TKZ 1967 255 545 415 Gas Coal Gas, Fuel Oil Coal
KPB 03B TRP-210 TKZ 1967 255 545 415 Gas Coal Gas, Fuel Oil Coal
KPB 04A TRP-210 TKZ 1968 255 545 415 Gas Coal Gas, Fuel Oil Coal
KPB 04B TRP-210 TKZ 1968 255 545 415 Gas Coal Gas, Fuel Oil Coal
KPB 05A TRU-210A TKZ 1969 255 545 415 Coal Gas Gas, Fuel Oil Coal
KPB 05B TRU-210A TKZ 1969 255 545 415 Coal Gas Gas, Fuel Oil Coal
KPB 01 TRU-210A TKZ 1970 255 545 415 Gas Coal Gas, Fuel Oil Coal
KPB 06B TRU-210A TKZ 1970 255 545 415 Gas Coal Gas, Fuel Oil Coal
KPB 07A TRU-210A TKZ 1971 255 545 415 Coal Gas Gas, Fuel Oil Coal
KPB 07B TRU-210A TKZ 1971 255 545 415 Coal Gas Gas, Fuel Oil Coal
KPB 08A TRU-210A TKZ 1972 255 545 415 Coal Gas Gas, Fuel Oil Coal
KPB 08B TRU-210A TKZ 1972 255 545 415 Coal Gas Gas, Fuel Oil Coal
Kirishskaya GRES
KPB 01A TGMP-114 TKZ 1969 255 545 500 Gas Fuel oil Gas, Fuel Oil Fuel oil
KPB 01B TGMP-114 TKZ 1969 255 545 500 Gas Fuel oil Gas, Fuel Oil Fuel oil
KPB 02A TGMP-114 TKZ 1970 255 545 500 Gas Fuel oil Gas, Fuel Oil Fuel oil
KPB 02B TGMP-114 TKZ 1970 255 545 500 Gas Fuel oil Gas, Fuel Oil Fuel oil
KPB 03A TGMP-114 TKZ 1970 255 545 500 Gas Fuel oil Gas, Fuel Oil Fuel oil
KPB 03B TGMP-114 TKZ 1970 255 545 500 Gas Fuel oil Gas, Fuel Oil Fuel oil
KPB 04 TGMP-324 TKZ 1971 255 535 1,000 Gas Fuel oil Gas, Fuel Oil Fuel oil
KPB 05 TGMP-324A TKZ 1973 255 535 1,000 Gas Fuel oil Gas, Fuel Oil Fuel oil
KPB 06 TGMP-324A TKZ 1975 255 535 1,000 Gas Fuel oil Gas, Fuel Oil Fuel oil
KP 1T TGM-84 TKZ 1965 140 550 420 Gas Fuel oil Gas, Fuel Oil Fuel oil
KP 2T TGM-84 TKZ 1966 140 550 420 Gas Fuel oil Gas, Fuel Oil Fuel oil
KP 3T TGM-84A TKZ 1966 140 550 420 Gas Fuel oil Gas, Fuel Oil Fuel oil
KP 4T TGM-84B TKZ 1974 140 550 420 Gas Fuel oil Gas, Fuel Oil Fuel oil
KP 5T TGM-84B TKZ 1976 140 550 420 Gas Fuel oil Gas, Fuel Oil Fuel oil
KP 6T TGM-84B TKZ 1983 140 550 420 Gas Fuel oil Gas, Fuel Oil Fuel oil
| APPENDIXES
150 | 151
BOILER | BOILER TYPE (GRADE) | MFR. | YEAR COMM. | LIVE STEAM PARAMETERS | OUTPUT | FUEL
FOR KINDLING/
PRESSURE TEMP PRIMARY RESERVE LIGHTING DESIGN
kgf/cm2 °С T/hr
Krasnoyarskaya GRES-2
1A PK-38 ZIO 1961 140 545 270 Coal – Fuel oil Coal
1B PK-38 ZIO 1961 140 545 270 Coal – Fuel oil Coal
2A PK-38 ZIO 1962 140 545 270 Coal – Fuel oil Coal
2B PK-38 ZIO 1962 140 545 270 Coal – Fuel oil Coal
4A PK-38 ZIO 1963 140 545 270 Coal – Fuel oil Coal
4B PK-38 ZIO 1963 140 545 270 Coal – Fuel oil Coal
5A PK-14 ZIO 1964 140 520 170 Coal – Fuel oil Coal
5B PK-14 ZIO 1964 140 520 170 Coal – Fuel oil Coal
6A PK-38 ZIO 1974 140 545 270 Coal – Fuel oil Coal
6B PK-38 ZIO 1975 140 545 270 Coal – Fuel oil Coal
7A PK-38 ZIO 1975 140 545 270 Coal – Fuel oil Coal
7B PK-38 ZIO 1975 140 545 270 Coal – Fuel oil Coal
8A PK-38 ZIO 1976 140 545 270 Coal – Fuel oil Coal
8B PK-38 ZIO 1976 140 545 270 Coal – Fuel oil Coal
9A BKZ-420-140RT BKZ 1981 140 560 420 Coal – Fuel oil Coal
9B BKZ-420-140RT BKZ 1982 140 560 420 Coal – Fuel oil Coal
10 A BKZ-420-140RT BKZ 1983 140 560 420 Coal – Fuel oil Coal
10 B BKZ-420-140RT BKZ 1987 140 560 420 Coal – Fuel oil Coal
Cherepovetskaya GRES
KPB 01A TR(E)-208-335 TKZ 1976 140 545 335 Coal Gas Gas, Fuel Oil Peat
KPB 01B TR(E)-208-335 TKZ 1976 140 545 335 Coal Gas Gas, Fuel Oil Peat
KPB 02A TR(E)-208-335 TKZ 1977 140 545 335 Coal Gas Gas, Fuel Oil Peat
KPB 02B TR(E)-208-335 TKZ 1977 140 545 335 Coal Gas Gas, Fuel Oil Peat
KPB 03A TR(E)-208-335 TKZ 1978 140 545 335 Coal Gas Gas, Fuel Oil Peat
KPB 03B TR(E)-208-335 TKZ 1978 140 545 335 Coal Gas Gas, Fuel Oil Peat
GRES-24
KBP 01 Pp-1000-25-545 (P-74) ZIO 1988 255 545 1,000 Gas – – Gas
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
TABLE #3. WATER BOILERS
BOILER | BOILER TYPE (GRADE) | MFR. | YEAR COMM. | HEAT TRANSFER MEDIUM PARAMETERS | OUTPUT | FUEL
PRESSURE TEMP PRIMARY RESERVE DESIGN
kgf/cm2 °С Gcal/hr
Krasnoyarskaya GRES-2
KV 2 RTVM-100 Belgorodsky 1973 25 150 100 Fuel oil Fuel oil Fuel oil
KV 3 RTVM-100 Belgorodsky 1976 25 150 100 Fuel oil Fuel oil Fuel oil
Kirishskaya GRES
KV 1 KVGM-100 DKZ 1982 16 150 100 Fuel oil Fuel oil Fuel oil
KV 2 KVGM-100 DKZ 1987 16 150 100 Fuel oil Fuel oil Fuel oil
Ryazanskaya GRES
KV 01 RTVM-30M-4 DKZ 1972 20 150 30 Fuel oil Fuel oil Fuel oil
KV 02 RTVM-30M-4 DKZ 1972 20 150 30 Fuel oil Fuel oil Fuel oil
ZIO — Podolsk engineering plant ZIO Podolsk,
TKZ — Taganrog boiler factory Krasny Kotelshchik,
BKL — Barnaul boiler factory Sibenergomash,
DKZ — Dorogobuzh boiler factory Dorogobuzhenergomash.
| APPENDIXES
152 | 153
TABLE #4. GENERATORS
PLANT # | TURBINE TYPE (GRADE) | MANUFACTURER | YEAR COMM. | VOLTAGE | CAPACITY | EXCITATION SYSTEM TYPE
PRIMARY RESERVE
kV MW
Ryazanskaya GRES
TGB 01 TVV-320-2 El. force 1973 20 320 HF with DC ELMASH
TGB 02 TVV-320-2 El. force 1973 20 320 HF with DC ELMASH
TGB 03 TVV-320-2 El. force 1974 20 320 HF with DC ELMASH
TGB 04 TVV-320-2 El. force 1974 20 320 HF with TV ELMASH
TGB 05 TZV-800-2UZ El. force 1980 24 800 TIR ELMASH
TGB 06 TZV-800-2UZ El. force 1981 24 800 TIR ELMASH
Novocherkasskaya GRES
TGB 01 TGV-300 KETM 1968 20 300 TIR ELMASH
TGB 02 TGV-300 KETM 1966 20 300 TIR ELMASH
TGB 03 TGV-300 KETM 1967 20 300 TIR ELMASH
TGB 04 TGV-300 KETM 1968 20 300 TIR ELMASH
TGB 05 TGV-300 KETM 1969 20 300 TIR ELMASH
TGB 06 TGV-300 KETM 1970 20 300 TIR ELMASH
TGB 07 TGV-300 KETM 1971 20 300 TIR ELMASH
TGB 08 TGV-300 KETM 1985 20 300 TIR ELMASH
Kirishskaya GRES
TGB 01 TVV-320-2UZ El. sila 1969 20 300 HF ELMASH
TGB 02 TVV-320-2UZ El. fsila 1970 20 300 HF ELMASH
TGB 03 TVV-320-2UZ El. sila 1970 20 300 TIR-PS S ELMASH
TGB 04 TVV-320-2UZ El. sila 1971 20 300 HF with DC ELMASH
TGB 05 TVV-320-2UZ El. sila 1973 20 300 HF ELMASH
TGB 06 TVV-320-2UZ El. sila 1975 20 300 TIR-PS S ELMASH
TG 1T TVF-60-2 El. force 1965 6.3 60 ELMASH ELMASH
TG 2T TVF-60-2 El. sila 1966 6.3 60 ELMASH ELMASH
TG 3T TVF-60-2 El. sila 1967 6.3 60 ELMASH ELMASH
TG 4T TVF-63-2 El. sila 1975 6.3 63 ELMASH ELMASH
TGB 5T TVV-63-2UZ El. sila 1976 6.3 63 ELMASH ELMASH
TGB 6T TVF-63-2UZ El. sila 1979 6.3 63 ELMASH ELMASH
Krasnoyarskaya GRES-2
1G TV-2-150-2 El. sila 1961 18 150 ELMASH ELMASH
2G TV-2-150-2 El. sila 1962 18 150 ELMASH ELMASH
4G TV-2-150-2 El. sila 1963 18 150 ELMASH ELMASH
5G TVF-60-2 El. sila 1964 6.3 50 ELMASH ELMASH
6G TVV-165-2UZ El. sila 1974 18 165 HF ELMASH
7G TVV-165-2UZ El. sila 1975 18 165 HF ELMASH
8G TVV-160-2EUZ El. sila 2002 18 160 HF ELMASH
9G TVV-160-2EUZ El. sila 1981 18 160 TIR ELMASH
10 G TVV-160-2EUZ El. sila 1983 18 160 TIR ELMASH
Cherepovetskaya GRES
TGB 01 TGV-200 KETM 1976 15.8 200 BSS with PV ELMASH
TGB 02 TGV-200 KETM 1977 15.8 200 BSS with PV ELMASH
TGB 03 TGV-200 KETM 1978 15.8 200 BSS with PV ELMASH
GRES-24
TGB 01 TVV-320-2EUZ El. sila 1988 20 320 TIR ELMASH
El. sila — Power Machines, Elektrosila factory,
KETM — Kharkov Elektrotyazhmash factory.
ANNUAL REPORT 2007 JSC “OGK-6”
| | |
12. CONTACT INFORMATION
1. COMPANY DETAILS
Full company name:
JSC Sixth Wholesale Power Market Generating Company
Abbreviated company name: JSC “OGK-6”
TIN 6164232756
IEC 616401001
OKOGU industry code 41002
OKPO organization code 76928058
OKVED 40.10.11
Bank details:
Bank name: JSC AKB ROSBANK
Current account 40702810000000017913
Correspondent account 30101810000000000256
RCBIC 044525256
Chief executive officer: Sanko, Valentin Mikhailovich
Head accountant: Dolgoarshinnykh, Bary Zakievich
Location: 344007, Rostov-on-Don, Bolshaya Sadovaya St. 49
Mailing address: 115162, Moscow, Mytnaya St. 21
Website: www.ogk6.ru
2. CONTACTS FOR SHAREHOLDERS AND INVESTORS
Troinikov, Ivan Vladimirovich (Head of the department of shareholder and investor relations)
Tel./Fax: (495) 644-23-65, e-mail: ir@ogk6.ru
For questions related to General Shareholders’ Meetings:
Gusev, Alexei Mikhailovich (Corporate Secretary)
Tel./Fax: (495) 644-23-68, e-mail: agusev@ogk6.ru
3. MEDIA CONTACTS
Filatov, Dmitry Evgenievich (Manager of the Board of Public Relations and Media Affairs)
Tel.: (495) 380-04-40, fax: (495) 380-41-65, e-mail: dfilatov@ogk6.ru
Shcheglov, Ivan Konstantinovich (press secretary)
Tel./Fax: (495) 380-41-65, e-mail: isheglov@ogk6.ru
| CONTACT INFORMATION
154 | 155
4. AUDITOR
Full company name: Closed Joint-Stock Company PwC Audit
Abbreviated company name: ZAO PwC Audit
Location: Moscow, Kosmodamianskaya Naberezhnaya, 52, bldg. 5
Tel.: (495) 967-60-00, fax: (495) 967-60-01
e-mail: irina.turchina@ru.pwc.com
www. pwc.ru
Certificate of state registration #008.890 of joint-stock company issued by the Moscow Registration Chamber
February 28, 1992. Certificate of entry in the Unified State Registry of Legal Entities of a legal entity registered
before July 1, 2002, under #1027700148431 dated August 22, 2002, issued by the Interregional Inspectorate of
the Russian Ministry of Taxation, #39 for Moscow.
Audit license: License № E000376
Issued 05.20.2002 by the RF Ministry of Finance
Validity: 5 years
5. REGISTRAR
Information concerning organizations recording the rights of the issuer to equity securities:
Full company name: JSC Central Moscow Depositary
Abbreviated company name: JSC CMD
Location: 107078, Moscow, Orlikov Per., 3, corp. V
Mailing address: 105082, Moscow, B. Pochtovaya St. 34, bldg. 8
Tel.: (495) 221-13-34, 221-13-30, 221-13-33, fax: (495) 221-13-83
e-mail: dr@mcd.ru
www.mcd.ru
License to maintain a registry:
License #10-000-1-00255. Issued 09.13.2002 by the Federal Committee for the Securities Market
Validity: no limitation on validity
Date from which the registry of registered securities of the issuer is maintained by the specified registrar:
07.20.2005.
ANNUAL REPORT 2007 JSC “OGK-6”
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