Human resource development

Building a world-class personnel team is critical for successful implementation of Gazprom Neft’s strategy to establish itself as a global leader in the petroleum industry.

The Company’s efforts in human resource management seek to develop new competences in its employees, to promote responsibility and creativity, and to create an environment where each employee feels involved in joint efforts as part of a shared strategy.

Company HR activities take account of trends on the employment market, which are regularly subjected to analysis by Company experts. Employment relations at the Company are based on mutual respect and human rights.

HR MANAGEMENT STANDARDS

The Company’s HR management strategy is based on a uniform system of policies and standards that are being gradually extended to all business units.

Work continued in 2011 to develop the efficiency management system that enables rapid assessment and control of employee efficiency through multi-level managerial indicators and individual targets set for each employee.

A program for regular personnel assessment has been developed and approved, which complements the current efficiency management system by annual assessment of employee performance using universal criteria of a professional, ethical and managerial nature. The assessment system launch in CC has been preceded by a broad awareness campaign addressed to all employees.

As our business geography expands, the Company has worked out a uniform concept of mobile personnel, which regulates the procedure for relocation of employees to work elsewhere in Russia and abroad, including a list of compensations and benefits to be used as additional incentives for relocation and the procedure for their allocation.

A system of grades has been established, setting the same clear and transparent principles at all business units for regulating remuneration, training and employee assessment. The grade system has been adopted by all main business units throughout the Company.

In 2011, a large-scale project was carried out to move the corporate headquarters of Gazprom Neft from Moscow to St. Petersburg. This involved the transfer of 670 employees in a short period, and special attention was paid to creation of a suitable compensation system, which helped the Company to keep its most valuable employees. Unprecedented work was also carried out to recruit and hire new employees in Saint Petersburg in order to ensure that operation of all Company business units continued without interruption. Over two thirds (68%) of the workforce at Gazprom Neft’s corporate headquarters were replaced in 2011 as a result of the relocation.

Gazprom Neft employee distribution by primary activities in 2011

Source: Company data

download xls
Gazprom Neft employee distribution by regions in 2011

Source: Company data

download xls

THE COMPANY WORKFORCE

Gazprom Neft employs about 59,000 people in 24 regions of Russia, and also in Kyrgyzstan, Kazakhstan, Tajikistan, Ukraine, Belarus, Serbia, Austria and Italy.

A large proportion of Gazprom Neft personnel — nearly one third (29%) — are concentrated in Yamal-Nenets Autonomous District with most of them working at production units. Omsk Region has 14% of Group employees. The share of employees in St. Petersburg nearly doubled in 2011 to 5.5% after Group headquarters moved from Moscow to St. Petersburg.

The overall number of personnel decreased by 9% in 2011 y-o-y due to business restructuring and a focus on core personnel. The Group partially disposed of its oil field service units and outsourced some of its production and refining functions. These initiatives reduced the number of Gazprom Neft employees.

However, the Company’s sales units (aircraft refueling and petroleum product supplies) experienced strong growth in 2011. As a result of this growth, and given that the Company acquired new assets in these segments too, staff numbers in these segments increased.

Labor Costs

An efficient employee incentive scheme encourages good performance, which in turn helps to achieve the Company’s business objectives. The Company is therefore committed to developing and implementing a comprehensive incentives system based on competitive wage levels, results-driven remuneration, and a social welfare component.

The Company maintains level of remuneration which is the market-average for the Russian oil and gas industry, and salaries are reviewed each year. The average monthly wage per employee in 2011 was RUB 59,989.

Labour costs grew by 11.5% in 2011 compared with 2010 to RUB 45.3 bn taking into account costs associated with the transfer of head office employees to St. Petersburg and costs associated with acquisitions.