1.5. Innovations at the Gazprom Group

PJSC Gazprom’s Innovative Development Program (the “Program”) until 2025 is Gazprom’s tool for the long-term planning and management of innovative activities which is part of the Group-wide strategic planning framework. It has a ten-year planning horizon and covers gas, oil and power generation businesses of the Gazprom Group. To deliver on the technological and organisational priorities of the Program, there are relevant R&D initiatives (plans) in place at PJSC Gazprom, PJSC Gazprom Neft, Gazprom Energoholding LLC and other subsidiaries and affiliates.

The Program prioritizes technological development with a focus on prospecting and exploration, and enhancing development efficiency, including greenfield, offshore, and unconventional resources. Gazprom also monitors and develops technologies for enhancing the efficiency of gas transportation and storage, hydrocarbon processing, LNG production, gas marketing and utilization.

PJSC Gazprom has an advanced innovation management framework in place. It also has a standing R&D Commission (the “Commission”) which considers whether and how PJSC Gazprom and its subsidiaries should implement R&D projects based on the principles of transparency, objectivity, and independence. In the reporting year, it saw the number of its members increase from seven to ten following the decisionOrder of PJSC Gazprom No. 473 dated November 9, 2021 to enhance its capabilities.

Gazprom supported the government initiative and announced the Year of Science and Technology in 2021 with a view to making science and technology more attractive to young talent, raising awareness about innovative opportunities of the gas science among broader audiences, and engaging the professional academic community in tackling the gas industry challenges.

The initiative saw more than 350 dedicated events promoting PJSC Gazprom as a socially responsible business with its own technical capabilities that supports science and education. Among these events were topical conferences and workshops, exhibitions and information boards demonstrating the Company’s latest achievements in R&D and import substitution, including four exhibitions and showrooms as part of the 10th Anniversary St. Petersburg International Gas Forum. PJSC Gazprom went public about its R&D activities on federal TV channels, periodicals, as well as its own and its partners’ web resources. The Company also held profession-oriented awards and competitions, video lectures on science and technology, etc.

All investment projects of the Gazprom Group are implemented using the latest available sci-tech solutions, including those developed jointly with Gazprom.

In the reporting year, Gubkin Russian State University of Oil and Gas, hired by PJSC Gazprom to develop digital technologies, continued to work on creating a structural and tectonic model for better trap prediction on the north-eastern shelf of Sakhalin using domestic cloud IT technologies.

Driven by cutting-edge solutions are PJSC Gazprom’s new technological projects and field development plans for such existing fields as Astrakhanskoye, Urengoyskoye, Severo-Urengoyskoye, Medvezhye, Yamburgskoye, Chayandinskoye, etc.

We completed the development of an integrated solution to increase working gas volume and reduce time for starting up cyclic operation of underground gas storage facilities in structurally complicated water formations.

In addition to technological innovations, PJSC Gazprom extensively develops and uses organizational innovations. The year 2021 saw active work on enhancing the system of long-term forecasting, cost management, and UGSS modeling.

PJSC Gazprom cooperates with partner universities as part of its Innovative Development Program until 2025.

PJSC Gazprom engages anchor universities in conducting R&D projects on all core areas of the Company’s technological chain such as software development, and digitalization of production and management functions. Many of them contribute to sustainable development.

In 2021, Gubkin Russian State University of Oil and Gas completed the following projects:

• predicted development and properties of reservoir rocks in Senonian sediments of the Nadym-Pur-Taz Region using digital lithological and petrophysical models and lithofacies simulation; solutions for creating import-substituting chemicals, materials and technologies to produce drilling muds and cement slurries;
• framework and requirements for information tools to support economic evaluation of Gazprom’s investment projects;
• integrated solution to increase working gas volume and reduce time for starting up cyclic operation of underground gas storage facilities in structurally complicated water formations.

In the reporting year, Gazprom and Lomonosov Moscow State University completed their joint research project on upgrading the technology to identify and assess geological processes and phenomena jeopardizing the construction of oil and gas facilities on the Far Eastern shelf of Russia. The advanced technology for engineering and geophysical survey was tried out on a deep water area of the Sakhalin shelf located at the Kirinsky license block of PJSC Gazprom. The obtained results will help the Company optimize the development of the Kirinskoye field, implying much lower risks associated with the design and construction of deep wells.

In addition to the anchor universities, the Company cooperates with other universities. In 2021, under the Cooperation Agreement between the Government of the Republic of Tatarstan and PJSC Gazprom, the Innopolis University completed the development of software for one-dimensional and threedimensional geomechanical modeling and a set of robotic tools to diagnose the technical condition of compressor stations and transmit data in real time. The University presented software architecture solutions for creating, editing and simultaneously visualizing 1D and 3D geomechanical models and diagnosing the technical condition of the Company’s gas transportation facilities. The parties decided to continue collaboration under the new Agreement on Scientific and Technical Cooperation between the Government of the Republic of Tatarstan and PJSC Gazprom, which was signed in the reporting year.

As part of its cooperation with the anchor universities, PJSC Gazprom is participating in building an innovative scientific and technical center for energy and oil and gas production at St. Petersburg State Marine Technical University (Primorskaya Dolina Science and Technology Center). The project will also involve other partner universities of PJSC Gazprom, including Gubkin Russian State University of Oil and Gas, Peter the Great St. Petersburg Polytechnic University, and St. Petersburg Electrotechnical University LETI. PJSC Gazprom’s representatives also sit on the working group in charge of developing a blueprint for the center.

In order to promote innovative activities and introduce innovations into its routines, Gazprom holds an annual competition for PJSC Gazprom Science and Technology Prize. In 2021, the competition saw 16 projects, with the total number of authors reaching 148, including 105 employees of PJSC Gazprom’s subsidiaries, 27 employees of PJSC Gazprom’s structural units, and 16 third-party employees.

In 2021, the top prize went to the project by Gazprom Proyektirovaniye on Scientific Rationale, Development and Implementation of a Membrane Technology for Helium Recovery from Natural Gas in Eastern Siberia and Russia’s Far East. The work entailed close cooperation with the relevant structural unit of PJSC Gazprom, Gazprom Dobycha Noyabrsk, Gazprom Dobycha Irkutsk, and Grasys. The innovative membrane technology of helium recovery makes it possible to adjust helium content in produced multi-component gas directly at the field before it is supplied to the pipeline for transportation.

The Strategy is compliant with the Digital Transformation Guidelines for State-Owned Corporations and Companies approved by the Presidium of the Government Commission on Digital Development on November 6, 2020, and conforms to federal laws, decrees and instructions of the President of the Russian Federation, decrees of the Government of the Russian Federation, and other federal regulations pertaining to digital transformation.

The Strategy:

• is a long-term planning and management document which is part of the Group’s strategic planning framework;
• covers the gas business of the Gazprom Group;
• contains a set of interconnected initiatives aimed at developing and implementing advanced digital technologies;
• provides for the Group’s transition to a platform-based business model.

The Gazprom Group’s digital transformation (DT) provides for a transition to a single integrated platform-based business model of the Gazprom Group, which involves gradual implementation of its strategic digitalization goals and the development of existing business segments.

As we see it, digital transformation is a continuous process covering automation, IT penetration and digitalization, and involving all business units of PJSC Gazprom and the Gazprom Group companies.

PJSC Gazprom’s IT Department identifies the priorities and realigns them when updating the Strategy.

The Strategy initiatives include:

• digital transformation projects;
• projects enabling basic IT and digitalization required to make digital transformation possible;
• DT initiatives focusing on financial and business performance;
• DT initiatives focusing on production and technology;
• DT initiatives focusing on communications;
• action plan for 2022–2024 providing for PJSC Gazprom’s and the Gazprom Group entities’ increased reliance on domestic software.

In 2021, the Gazprom Group continued to implement its Comprehensive Target Program for the Development of the Integrated Information Environment (IIE) for 2018–2022Approved by resolution of the Management Committee of PJSC Gazprom No. 39 dated October 23, 2017, including the following projects:

• electronic management system for accounting documents and contracts at PJSC Gazprom, its subsidiaries and entities;

• gas and condensate transportation information management system (Stage 1) at PJSC Gazprom’s gas transportation subsidiaries (Phase 1).

The Group continued to develop its integrated IT infrastructure by meeting Gazprom’s needs for servers and hardware.

The Strategy provides for the respective IIE projects to continue into 2022 and for PJSC Gazprom and the Gazprom Group to consistently work towards digitalization and digital transformation.

In 2021, we launched a routine to collect data from our subsidiaries on proposals to the Gazprom Group’s Digital Projects and Technologies Bank which seeks to provide up-to-date and exhaustive information to the Group’s employees, identify opportunities for the rollout, licensing, and commercialization of the best products both within and beyond the Group. The project provides for consolidation, analysis, support and selection of best practices based on the experience of PJSC Gazprom’s subsidiaries.

The COVID-19 pandemic in 2021 had no direct impact on the Gazprom Group’s accelerated digitalization.

The first stage of the Strategy includes creating the Gazprom Group’s Integrated Reference Data and Knowledge Model, a corporate repository containing information about the Group’s key assets and business processes, its suppliers and contractors, existing and prospective consumers, current regulatory requirements, etc.

This model will leverage digital platforms to build digital ecosystems for gas, oil and electric power businesses, which will be integrated with digital services into the Gazprom Group’s digital eco-environment going forward.