Sovcomflot (Russian: ПАО «Совкомфлот», ПАО «Современный коммерческий флот», lit. 'Modern Commercial Fleet') is Russia's largest shipping company, and one of the global leaders in the maritime transportation of hydrocarbons, as well as the servicing and support of offshore exploration and oil & gas production.
 | |
| Company type | State-owned corporation |
|---|---|
| Industry | Shipping |
| Founded | 1988 |
| Headquarters | Saint Petersburg |
Area served | Worldwide |
Key people | Sergey Frank (Chairman of the Board of Directors of PAO Sovcomflot)[citation needed] Igor Tonkovidov (Member of the Board of Directors, President and Chief Executive Officer of PAO Sovcomflot)[citation needed] |
| Revenue | $1.44 billion[1][2] (2017; 2020) |
| $491 million[2] (2020) | |
| $267 million[2] (2020) | |
| Total assets | $7.74 billion[2] (2020) |
| Total equity | $4.1 billion[2] (2020) |
| Owner | Government of Russia (82.8%) |
Number of employees | 7,700 (2019) |
| Website | Official website |
History
editIn 1973 the Government of the USSR decreed the formation of a special shipping corporation, separated from the regular state-owned marine fleet, that could use a long-term bare boat charter scheme for purchasing new and used foreign-built vessels. In 1976 the Ministry of Merchant Marine instituted a special fund and the newly formed corporation used it to acquire two 40,000 DWT, dry cargo transports – Sovfracht and Sovinflot.[citation needed]
In 1988 these operations were reorganized as the Sovcomflot Joint-Stock Company (SCF), a then one-of-a-kind state-owned corporation with special authorization by the USSR Council of Ministers. By 1990 its assets reached a gross tonnage carrying capacity of 1,800,000 DWT. A further reorganization in June 1995 confirmed the special status of Sovcomflot as a state-owned business.[citation needed]
In June 2007 President of Russia Vladimir Putin authorized the merger of Sovcomflot and Novoship; the state 'invested' its 50.34% share in Novoship in Sovcomflot capital.[3] The legal procedures were completed in early 2008 and in January 2008 Sovcomflot offered a stock buyout to the remaining minority shareholders of Novoship.[4] The integration of Novoship assets into Sovcomflot operations continues as of August 2008 (fleet management and sales were unified in July 2008).[5]
In August 2017 the Christophe de Margerie, a tanker owned by Sovcomflot, became the first cargo ship to complete the so-called Northern Sea Route, completing a journey from Hammerfest in Norway to Boryeong in South Korea in the record time of 22 days.[6]
Sanctions
editOn 24 February 2022 the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned Sovcomflot under E.O. 14024 for being owned or controlled by, or having acted or purposed to act for or on behalf of, directly or indirectly, the GoR. Subsidiary companies were also sanctioned.[7]
On 15 March 2022, as a result of the 2022 Russian invasion of Ukraine the EU imposed sanctions on Sovcomflot.[8] On March 24, 2022, the United Kingdom followed suit. Sovcomflot has also been sanctioned by Canada and the United States has prohibited Sovcomflot from raising funds on American capital markets.[9] The American sanctions made it very difficult for Sovcomflot to get insurance for its vessels and cargoes. This has led many Asian customers to cancel orders for Sokol, one of three main export-grade crude oils sold by Russia.[10] On 20 April, New Zealand also announced sanctions.[11]
On May 5, 2022, Lloyds List reported that Sovcomflot intended to sell up to a third of its fleet in order to generate cash to pay off creditors. Sovcomflot called the report "exaggerated" and "rumours", and said it was merely selling off old facilities and vessels.[12]
On 10 June 2022 the Russian National Reinsurance Company announced it would reinsure Russian ships including Sovcomflot's when the Russian shipping industry was left high and dry by the 2022 sanctions.[13][14] It came to light on 13 June that Ingosstrakh had insured the Sovcomflot fleet.[14] On 23 June 2022 the Indian Register of Shipping announced that it would provide safety certification for several dozen ships managed by Dubai-based SCF Management Services, a subsidiary of Sovcomflot.[15][16][17] The CEO said on 18 June that Sovcomflot had insured all its cargo vessels with Russian insurers.[15][18]
On 23 February 2024, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) imposed sanctions on Sovcomflot, targeting its revenue from oil sales to further restrict Russia's financial capabilities in light of its invasion of Ukraine. The sanctions include freezing U.S. assets of Sovcomflot and designating 14 of its crude oil tankers, while allowing temporary transactions to offload oil from these vessels.[19][20]
Fleet
edit
As of May 2022, the company owned 122 vessels. The fleet includes 50 crude oil tankers, 34 oil products tankers, 14 shuttle tankers, and 10 natural gas carriers. Sovcomflot also owns 10 icebreakers.[12]
Management
editThe company is registered in Saint-Petersburg and has representative offices in Moscow, Novorossiysk, Murmansk, Vladivostok, Yuzhno-Sakhalinsk, London, Limassol and Dubai.
Sovcomflot board of directors is usually headed by executives from the Presidential Administration of Russia. In July 2007 Igor Shuvalov, long-time chairman of the board and an aide to Vladimir Putin, was replaced by Sergey Naryshkin, chief of staff of Presidential Administration. Other directors were in 2007: Andrey Kostin (Vneshtorgbank), Yury Medvedev, Alexander Misharin, Gleb Nikitin, Charles E. Ryan (of Deutsche Bank), Aleksey Sokolov, Elena Titova (Morgan Stanley), Alexander Tikhonov, Sergey Frank (Chief Executive Officer).
Sergey Frank controlled the operations as CEO from October 2004 until at least 2012. The Management Board also included as of 2012: Sergey Burima (operations), Nicholas Fairfax (London operations), Andrey Khlunev (accounting), Nikolay Kolesnikov (finance), Aleksandr Kurtynin (audit), Callum Ludgate (charter and gas), Vladimir Mednikov (law), Sergey Popravko (Cyprus operations).[21]
As of August 2019, Frank was still CEO, while Nikolay Kolesnikov was CFO and Igor Tonkovidov was chief operating officer and chief technical officer.[22]
See also
editNotes
edit- ^ "2017 Full Year Consolidated Financial Statements under IFRS (USD)". Retrieved 28 October 2018.
- ^ a b c d e "2020 Full Year Consolidated Financial Statements under IFRS (USD)". Sovcomflot. 15 March 2021. p. 63. Retrieved 15 March 2021.
- ^ "Rossiyskaya Gazeta, June 21, 2007". Российская Газета. Rg.ru. 2007-06-21. Retrieved 2012-03-08.
- ^ RBC Daily, 11.01.2008
- ^ "Nash Novorossiysk, July 24, 2008". Nnvrsk.ru. 2008-07-24. Retrieved 2012-03-08.
- ^ "Russian tanker sails through Arctic without icebreaker for first time". TheGuardian.com. 24 August 2017.
- ^ "U.S. Treasury Announces Unprecedented & Expansive Sanctions Against Russia, Imposing Swift and Severe Economic Costs". 24 February 2022.
- ^ "EU introduces additional sanctions against Russia". 17 March 2022. Retrieved 8 February 2023.
- ^ "UK Sanctions on Sovcomflot Create New Challenge for Russia's Tankers".
- ^ Cheong, Serene; Cho, Sharon; Chakraborty, Debjit (April 25, 2022). "Asian Buyers Trying to Back Out of Purchases of Russian Oil Grade". Bloomberg Business News. Retrieved April 26, 2022.
- ^ "Russia Sanctions Regulations 2022". Retrieved 11 February 2023.
- ^ a b "Russia's Sovcomflot says it plans to sell part of its fleet". Reuters. May 6, 2022. Retrieved May 6, 2022.
- ^ "EXCLUSIVE Russia's state-owned RNRC to reinsure Russian oil shipments, sources say". Reuters. 10 June 2022.
- ^ a b "Russia's state-owned RNRC to reinsure Russian oil shipments, sources say". Hellenic Shipping News Worldwide. 13 June 2022.
- ^ a b "India provides safety certification to Russian oil tankers". Ship Technology. Reuters. 23 June 2022.
- ^ "India Sails to Rescue of Russian Oil Tankers Hit by Sanctions". Capital Link International Holdings Ltd. Asia Financial. 23 June 2022.
- ^ "Reuters : India provides safety certification to Russian oil tankers". eBlue Economy. Reuters. 23 June 2022.
- ^ "Sovcomflot fleet fully covered by Russian insurers, CEO says". Reuters. 18 June 2022.
- ^ Gardner, Timothy; Psaledakis, Daphne (24 February 2024). "US imposes sanctions on Russia's leading tanker group Sovcomflot". Reuters. Retrieved 26 February 2024.
- ^ "U.S. Treasury Designates Russian State-Owned Sovcomflot, Russia's Largest Shipping Company". U.S. DEPARTMENT OF THE TREASURY. 23 February 2024. Retrieved 26 February 2024.
- ^ "Sovcomflot website. Management board". Sovcomflot.ru. Retrieved 2012-03-08.
- ^ Dixon, Gary (29 August 2019). "Frank 'cautiously optimistic' as Sovcomflot returns to profit". PAO Sovcomflot. Trade Winds.
External links
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