annual report of jsc atomenergoprom energo for 2013...

2013

ANNUAL REPORT

Annual Report of JSC Atomenergoprom for 2013

ATOMENERGOPROM

АТОМENERGOPROM

ANNUAL REPORT OF JSC ATOMENERGOPROM FOR 2013

4 BackgroundofJSCAtomenergoprom

4 ShareholdersofJSCAtomenergoprom

4 AuditorofJSCAtomenergoprom

4 RegistryholderofJSCAtomenergoprom

shares

5 Reportinformation

6 Keyresultsof2013

10 Keyeventsof2013

95 Annex 4.Summaryconsolidated

financialstatementspreparedon

thebasicofconsolidatedfinancial

statementsfortheyearended31

December2013andAuditors’report

108 Annex 5. Listoftransactionsmadeby

JSCAtomenergoprominthereporting

period,andrecognisedasmajor

transactions,towhichtheprocedure

forapprovalsofmajortransactions

applyasspecifiedintheArticlesof

Association

109 Annex 6.Listofinterestedparty

transactionsbyJSCAtomenergoprom

inthereportingyear

117 Abbreviations

119 Glossary

123 Feedbackform

125 Contactdetails

70 3.3.Managementofhumancapital

76 3.4.Managementofsocialand

reputationalcapital

84 3.5.Managementofnaturalcapital,

environmentalsafety,andprotection

oftheenvironment

86 Annex 1.Generalandspecific

GRI(G4)standarddisclosuresand

compliancewiththeRUIE’skey

performanceindicators(KPI)

88 Annex 2.AuditingCommission’sreport

ontheauditfindingswithrespecttothe

financialandbusinessactivitiesof

JSCAtomenergopromin2013

89 Annex 3. ObservanceoftheCorporate

ConductCodebyJSCAtomenergoprom

12 AddressfromtheChairpersonofthe

BoardofDirectors

13 AddressfromtheDirectorKomarovK.B.

Chapter1.

JSCAtomenergopromprofile

16 1.1.Companybackground

17 1.2.Managementofsustainable

development

18 1.3.Corporatemanagement

25 1.4.Riskmanagement

Chapter2.

Strategyandimplementationresults

in2013

32 2.1.Activitiesstrategy

33 2.2.Financialandeconomic

performance

37 2.3.Efficientnuclearelectricitysupplies

forRussianindustries

45 2.4.Strengtheningoftheglobalplayer

positionintheglobalmarketofnuclear

services

58 2.5.Nuclearandradiationsafety

Chapter3.

Efficiencyofcapitalmanagement

64 3.1.Managementoffinancialcapital

67 3.2.Managementofmanufactured

capital

TABLE OF CONTENTS

JSC ATOMENERGOPROM AnnualReport 2013- 2 3

The annual public report of Joint-Stock CompanyAtomenergoprom (JSC Atomenergoprom, referredto as “the Company”, in the Report) for 2013 is theCompany’sfirstintegratedreport.Thereportprovidesan integrated account of the Company’s strategy andJSCAtomenergoprom’smajorfinancial,economic,andproduction performance data for 2013, as well as itsperformanceinthefieldofnuclearandradiationsafety,the field of environmental protection, contributions tothesustainabledevelopmentofoperatingareas,socialpolicyimplementation,andotheraspectsofsustainabledevelopment.

JSC Atomenergoprom issues reports on a yearlybasis, and the previous annual report was publishedin2013.ThisReportdisclosestheperformancedataoftheCompanyand itsorganisations for theperiodof1January through 31 December 2013. It also disclosesselected information and performance data for theentireRussiannuclearindustry.

Standardsandregulatoryrequirements

The report has been prepared using the followingdocuments:

» The State Atomic Energy Corporation ROSATOM’spublicreportingpolicy;

» International IntegratedReportingStandardof theInternational Integrated Reporting Council (theInternationalIRFramework);

» The Guidelines on Sustainable Development bythe Global Reporting Initiative (GRI, version G4).See Annex 1 for the index of the StandardDisclosures;

» TheAA1000SeriesofStandardsof the InstituteofSocialandEthicalAccountability;

» FederalLaw“OnJoint-StockCompanies”No.208-FZ,dated26.12.1995;

» FFMSorder,entitled“OntheApprovaloftheBylawonthe InformationDisclosureby IssuersofEquitySecurities, No. 06-117/pz-n, dated 10.10.2006, asrevisedon04.10.2011;

» FSMC instruction, entitled “On RecommendationsfortheApplicationoftheCorporateConductCode”,No.421/r,dated04.04.2002;and

» FSMC instruction, entitled “On ProceduralRecommendationsfortheComponentsandFormsof the Delivery of Information on the CorporateConduct Code Observance in Annual Reportsof Joint-Stock Companies”, No. 03-849/r, dated30.04.2003.

Verificationofreportinginformation

The authenticity of the reported information hasbeen certified by JSC Atomenergoprom’s auditingcommissionandbyanindependentauditingorganisationthathascertifiedtheauthenticityoftheannualfinancialstatements.

Predictivedatapublicationdisclaimer

TheReportcontainsinformationontheCompany’smedium-andshort-termplansandinitiatives.Theplansareofapredictivenatureandthe feasibility thereforedependsonanumberofeconomic,political,and legalfactorsbeyondtheCompany’scontrol(globalfinancial,economic,andpoliticalsituations;keymarketsituations;changes to tax, customs, and environmental laws;and others). For this reason, the actual performancedatainthefutureyearsmaydifferfromthepredictivestatementspublishedherein.

REPORT INFORMATION

BackgroundofJSCAtomenergoprom» Primarystateregistrationnumber:1077758081664

» Stateregistrationdate:19 July 2007

» Registeringauthority:Moscow Inter-district Inspectorate No. 46 of the Federal Tax Service

» Location:24 Bolshaya Ordynka Str., Moscow

» Tel:(495) 969-29-39

» Fax:(495) 969-29-36

» Corporatewebsite:www.atomenergoprom.ru

ShareholdersofJSCAtomenergoprom» Asof31.12.2013,theregisteredshareholderofJSCAtomenergopromwas:The State Atomic Energy Corporation

ROSATOM

» Location:24 Bolshaya Ordynka Str., Moscow 119017, Russia

» Statusofregisteredperson:shareholder

» StakeintheCompany’sauthorisedcapital:100%

» Votingstockheldbyregisteredperson:100%

AuditorofJSCAtomenergoprom» Fullname:Financial and Accounting Consultants, Limited Liability Company

» Fulltitle:44/1 Myasnitskaya Str., Moscow 101990, Russia

» TIN:7701017140

» PSRN:1027700058286

» Tel:+7 (495) 737-53-53

» Fax:+7 (495) 737-53-47

» E-mail:[email protected]

AuditorofthesummaryconsolidatedfinancialstandingstatementandconsolidatedfinancialstandingstatementisJSCKPMG.

RegistryholderofJSCAtomenergopromshares» Theregisterof the registeredholdersofJSCAtomenergoprom iskeptbyJoint-Stock Company Registrator

R.O.S.T.

» Abbreviatedcompanyname:JSC Registrator R.O.S.T.

» Title:18-13, Stromynka Str., Moscow 107996, Russia

» TIN:7726030449

» PSRN:1027739216757

» Licence:10-000-1-00264

» Issuedate:03.12.2002

» Expirydate:Perpetual

» Licensingauthority:Federal Securities Market Commission (Federal Securities Market Service) of Russia

» Thedatefromwhichtheregistryholderkeepsregisteroftheissuer:28.10.2009.

JSCRegistratorR.O.S.T.alsokeepsregistersofmostofJSCAtomenergoprom’ssubsidiaries,whichenablesmorerapidandreliabletransactionsofsharesinthecourseofreformingtheholding’scorporatestructure.

JSC ATOMENERGOPROM Annual Report 2013- 4 5

636.7 550.5+155.0*

541.9+229.45*

96.3%2013/2012

2011

2012

2013

172.7 177.3 172.2

97.1%2013/2012

96 % 105 % 103 %

2011 2012 2013

9 9 9

100%2013/2012

2011

2012

2013

2011

2012

2013

81.2 % 80.9 % 77.9 %

2011

2012

2013

2011 2012 2013

7.1 7.6 8.3

109.2%2013/2012

2011 2012 2013

7,563 6,579 6,866

104.4%2013/2012

2011 2012 2013

50.9 66.5 72.7

2011 2012 2013

10 12 11

91.7%2013/2012

2011

2012

2013

389.4 394.8 436.1

IFRSREVENUES,BILLIONROUBLES

110.5%2013/2012

92.2%2013/2012

2011

2012

2013

60,9 26.8 24.7

*Thebottomline,markedwith+,presentsdataonthemineraland raw material base of Uranium One Inc. Due to the changeofthecalculationtechniquein2012,thedataisgivenseparatelyfortheRussianassetsandthemineralandrawmaterialbaseofUraniumOneInc.The2013dataisgivenonlyforRussianassets.


1Inthistableandhereinafter,the2012dataistakenasthereferencelevelforcalculatingtheindicatorsinthe‘2013/2012,%’column.

CAPACITYFACTORSOFNPPS,% URANIUMRESOURCESBASE(RUSSIANASSETS),THOUSANDTONNES

POWERGENERATIONBYNPPS,BILLIONKWH

NUMBEROFNPPUNITSUNDERCONSTRUCTIONINRUSSIA

KEY RESULTS OF 20131

URANIUMPRODUCTION,THOUSANDTONNES

PORTFOLIOOFFOREIGNCONTRACTSOVER10YEARS,BILLIONUSD

NETPROFIT,BILLIONROUBLES

NUMBEROFFABRICATEDFAsJSCCONCERNROSENERGOATOM’SINVESTMENTPROGRAMMEPERFORMANCEINDEX

NUMBEROFNPPUNITSUNDERCONSTRUCTIONOVERSEAS

109,3%2013/2012

163.2 118.3 150.4

127.1%2013/2012

2011 2012 2013

2011 2012 2013 2011 2012 2013

1,226.0 49.971,280.9 54.981,347.0 61.76

151.6%2013/2012

123.3%2013/2012

33.4 42.4 37.4

2011

2012

2013

88.2%2013/2012

EVENTSTHATQUALIFIEDLEVEL-2ANDABOVEONTHEINESSCALE

20.3%2013

2011

2012

2013

*Mining,Fuel,MachineEngineering,andPowerEngineeringDivisions.

0 0 0


EBITDA*,BILLIONROUBLES

AVERAGEWAGEOFJSCATOMENERGOPROM’SPERSONNEL,

THOUSANDRUB/MONTH

INTANGIBLEASSETS,BILLIONROUBLES

AVERAGEDECREASEINENERGYCONSUMPTIONCOSTWITHINDIVISIONS*

*ThefollowingformulawasusedtocalculatetheEBITDAindicator:Revenues–Operatingcosts–Administrativecosts–Commercialcosts+Depreciation.

NETASSETS(IFRS),BILLIONROUBLES

РОСАТОМ Публичныйгодовойотчет2013

2013

KEY EVENTS OF 2013

FEBRUARY

» A memorandum of cooperation in the field ofnuclearmedicineandtheproductionofradioactivemedicalpreparationswassignedwiththeNuclearEnergy and Advanced Technology Agency of theRepublicofCuba’sMinistryofScience,Technology,andEnvironment.

JUNE

» AnagreementofcooperationinthepeacefuluseofatomicenergywassignedwiththeAtomicEnergyAuthority of the Democratic Socialist Republic ofSriLanka.

» AmemorandumofcooperationwassignedwiththeUSDepartmentofEnergyandtheAtomicEnergyCommissionofFrancefortheestablishmentoftheInternationalResearchCentrebasedontheMBIR

multipurposefast-neutronresearchreactor.» TheIAEAMinisterialConferenceonNuclearPower

in the 21st Century and the International ForumATOMEXPO-2013 were held in St. Petersburg,Russia.

JULY» Themusical“We”premieredinKeszthely,Hungary

aspartoftheNucKids-2013project.

AUGUST

» Start of an engineering survey at the site ofSmolensk NPP II as part of the investmentfeasibilitystudyphase.

» Moody’s Investors Service, an international

rating agency, assigned JSC Atomenergoprom aBaa2long-terminternationalscalerating(stableoutlook)andanAaa.runationalscalerating.

» Fitch Ratings, an international rating agency,assignedJSCAtomenergopromaBBBlong-terminternationalscalerating(stableoutlook).

SEPTEMBER

» JSCUraniumEnrichmentCentre(UEC),aRussian-Kazakh joint venture, completed the transactionofpurchasinga25%stake+1shareinJSCUECC(an organisation within the Fuel Division ofJSCAtomenergoprom)

» AnagreementbetweenthegovernmentsofRussiaandtheUSAoncooperationinnuclearenergyandR&Dwassigned.

» A memorandum on economic cooperation in thepeaceful use of atomic energy was signed withtheDepartmentofenergyandClimateChangeofGreatBritain.

» Powerstart-upofKudankulamNPP’sUnit1intheRepublicofIndia.

OCTOBER

» The 3rd overseas Atomic Energy InformationCentrewasopenedinDhaka,Bangladesh.

» First concretingatUnit1ofTianwanNPP in theChinesePeople’sRepublic.

» Along-termcontractwassignedbyJSCTVELwiththe People’s Republic of China for the supply ofnuclearfuelforUnits3and4ofTianwanNPPandaccessoriesfortheNPP’sPhase2.

» A technical contract was signed between theRussianFederationandtheRepublicofBangladeshfortheconstructionofRuppurNPP

» The100%stakeinUraniumOneInc.wasconsolidatedby JSC Atomredmetzoloto (an organisation withintheMiningDivisionofJSCAtomenergoprom).

» Standard&Poor’s,aninternationalratingagency,confirmed JSC Atomenergoprom’s BBB/A-2long-term and short-term credit ratings (stableoutlook), as well as the company’s ruAAAnational scale rating at the maximum possiblesovereign level. Simultaneously, the BBB/ruAAAcredit ratings were confirmed with respect toJSC Atomenergoprom’s circulating bonds, seriesNo.6,ofthenominalvalueof10billionroubles.

NOVEMBER

» Reopening the operations on the LeningradNPP’sUnit1after therestoring theRBMK-1000reactor’sservicelifecharacteristics.

» Winning a tender for the NPP construction inJordan.

DECEMBER

» A memorandum of cooperation in the field ofradioactive preparations was signed with theAtomicEnergyCommissionof theStateof Israelas part of the meeting of co-chairpersons ofthe Russian-Israeli Joint Trade and EconomicCooperationCommission

» The BN-800 reactor at Beloyarsk NPP waspreparedforfirstcriticality.

» A package of agreements on the constructionof Hanhikivi NPP in Finland was signed with theFinnishcompanyFennovoima.

» Standard&Poor’s,aninternationalratingagency,confirmed the BBB-/A-3 long-term and short-termcreditratingsandtheruAAAnationalscalerating(stableoutlook)forJSCTENEX-Service(anorganisationwithinJSCAtomenergoprom).

- 10 11 JSC ATOMENERGOPROM AnnualReport 2013

ADDRESS FROM THE CHAIRPERSON

OF THE BOARD OF DIRECTORS

ADDRESS FROM THE DIRECTOR

DearColleagues,JSC Atomenergoprom is an integrated company

thatconsolidatescivilianassetsoftheRussiannuclearindustry. The Company incorporates many leadingnuclear organisations and enterprises, combiningthose assets with its more than 70-year history andunique experience across the spectrum of nuclearfuel cycle and NPP construction technologies. Thisimmense base of experience forms the foundationfor the company’s leadership in the world market ofnucleartechnologies.

This annual report discloses the financialperformanceandproductiondataofJSCAtomenergo-promanditsorganisations,aswellastheirrespectivecontributions to the national economy and the

sustainable development of Russia and its regionsin2013.Theperformanceachieved(uraniumoutput,electricity generation, implementation of JSCConcern Rosenergoatom’s investment programme)has exceeded the target figures. The Company’skey financial performance indicators also showedsustained growth. In the reporting period, themanagement of JSC Atomenergoprom and itsorganisationsachievedallkeyefficiencyindicators.

In terms of nuclear installed capacity,JSC Atomenergoprom is the world’s second largestnuclear generating company after EDF, France.The nuclear electricity generation in 2013 in Russiaamounted to 172.2 billion kWh. In 2013, Russiannuclearpowerplantsaccountedfor16.8%ofthetotalelectricitygeneratedinRussia.

The most important project in 2013 was thecreationofatechnologyforrecoveringtheservicelifecharacteristics of the RBMK-1000 reactor graphitestack. The repair activities were successfullycompletedatUnit1ofLeningradNPPand,presently,thetechnologyisbeingreplicatedinrepairoperationsat other RBMK-type units at Kursk and SmolenskNPPs. This technology is unique so that it makes itpossible to extend the life of the RBMK uranium-graphite reactors until the replacement capacity isput into operation, which is of special importancebecausetheRBMKreactorsaccountforabouthalfofthenuclearpowergenerateddomestically.

The Company’s 2013 performance allows us tolooktowardsthefuturewithconfidenceandformulatefurtherchallengingtasksaspartofourstrategicgoal–globaltechnologicalleadershipintheinternationalmarketsofnucleartechnologiesandservices.

BoardofDirectors,Chairperson

JSCAtomenergoprom

E. V. LYAKHOVA

Dearcolleaguesandpartners,TheCompany’sperformancewasveryimpressive

last year. The portfolio of foreign contracts over 10yearsgrew fromUS$66,5billion toUS$72,7billion.Therewasalsomajorgrowthintheuraniumproductionvolume,ascomparedto2012,from7.6to8.3thousandtonnes.In2013,wecarriedoutconstructionactivitiesfor9NPPunits inRussiaand11moreunits inothercountries.

There were also a number of notable events inthereportingyear.Unit1ofKudankulamNNPinIndiasawapowerstart-up,whileresearchactivitiesfortheconstructionofSmolenskNPPIIbeganinRussia.TheBN-800 fast-neutron reactor was prepared for firstcriticality at Beloyarsk NPP, which is an important

eventfortheindustry,asweregardtheso-calledfast-neutron technology as the future of nuclear power.Fast-neutronreactorsallowforpracticallyallnaturaluranium to be engaged in the nuclear fuel cycle,making it possible to resolve the fuel problem forcenturiestocome.Asaresult,efficiencyisincreased,natural resources are saved, and the quantities ofradioactivewastearedecreaseddozensoftimes.

The20-year-longRussian-UScooperationundertheHEU-LEUprogrammeendedinthereportingyear.As part of the programme, the Company acquiredvaluable experience concerning operations in theUSmarketandproveditselftobearesponsibleandreliablesupplierunderthecontractsmade.

In2013,theassetsintheuraniumminingsegmentwere restructured: Uranium One Holding N.V. wasformed to concentrate the overseas nuclear fuelcycle front-end assets; JSC Atomredmetzoloto willfocusfurtheronthedevelopmentofuraniumassetsinRussia.

Regardingfinancialperformanceinthereportingyear, it is worth emphasizing that the Company’sreturns grew by more than 10%, as compared to2012, to reach 436.1 billion roubles. The Company’snetprofitamountedto24.7billionroubles.

ThemostimportantdemonstrationofJSCAtom-energoprom’ssolvencyand financialstability is thatin 2013 the Company was assigned credit ratingsfromtwointernationalratingagencies:FitchRatings(at theBBBmaximumpossiblesovereign level)andMoody’s Investors Service (at the Ваа2 level). Alsoin 2013, Standard & Poor’s, a global rating agency,confirmedtheCompany’slong-termandshort-terminternationalscalecreditratingsattheВВВ/А-2level.

I would like to express my gratitude to allthe employees of JSC Atomenergoprom and itsorganisations, as well as to our business partners,thanks to whom the Company’s impressiveperformance could be achieved. I am sure that thecomingyearwillbenolesssuccessful!

Director,

JSCAtomenergoprom

K.B.KOMAROV


JSC ATOMENERGOPROM PROFILE

1 16 1.1. COMPANY BACKGROUND

17 1.2. MANAGEMENT OF SUSTAINABLE DEVELOPMENT

18 1.3. CORPORATE MANAGEMENT

25 1.4. RISK MANAGEMENT

1.1. Companybackground1.1.1.Activities

JSC Atomenergoprom (named as “the Company”hereinafter)isanintegratedcompanythatconsolidatescivilianassetsoftheRussiannuclearindustry.

The organisations of JSC Atomenergopromencompass the entire cycle of nuclear production

activities, from uranium mining to construction ofNPPsandelectricitygeneration,withpriorityplacedontheimprovementofproductionquality,theintroductionof innovative technologies, and environmentalmanagement.

JSCAtomenergopromisoneofthelargestnucleargenerationcompanies inRussiaandisa leader intheglobalmarketofnuclearservicesandtechnologies.TheCompanyisinapositiontoensureturnkeyNPPdesignand construction, to provide NPPs with a lifetime offuel supplies, and to carry out upgrading, after-salesservicing, and personnel training. The Company hasintegratedmanyleadingorganisationsandenterprisesin thenuclear industryover itsapproximately70-yearhistory of operations, and boasts a unique range ofexperience across the spectrum of nuclear fuel cycleandNPPconstructiontechnologies.

JSCAtomenergopromisapartoftheStateAtomicEnergy Corporation ROSATOM (named as “RosatomStateCorporation”or“Rosatom”hereinafter).RosatomState Corporation is responsible for pursuing thegovernmental policies related to nuclear power andensuringtheunityofmanagementinthefieldofnuclearpower, as well as for the sustained operation of thenuclear power generation complex, the evolution oftheRussiannuclearindustry’sinnovativepotential,theactivities of the nuclear icebreaker fleet, and nuclearand radiation safety. Rosatom is also assigned thetask of enforcing Russia’s international commitmentsinthepeacefuluseofatomicenergyandnuclearnon-proliferation. The activities of Rosatom are aimed atcontributing to the implementation of federal target

programmes, establishing new conditions for thenuclearindustry’sevolution,andstrengtheningRussia’scompetitiveadvantage in theworldmarketofnucleartechnologies.

ThereisnolinkbetweenmilitaryactivitiesandthecivilianoperationsofRosatom, including thebusinessoperations of JSC Atomenergoprom. Therefore, theactivitiesofJSCAtomenergoprom,asacompany thatconsolidatesthecivilianassetsoftheRussiannuclearindustry,havenothingtodowithmilitaryoperations.

1.1.2.Formationanddevelopmentalhistoryof

JSCAtomenergoprom

JSC Atomenergoprom was formed in July 2007as part of the Russian Federation Nuclear IndustryDevelopment Programme approved by RussianPresident V. V. Putin on 8 June 2006 pursuant toFederal Law No. 13-FZ, dated 5 February 2013, “OnPeculiarities of the Management and Disposal of thePropertyandSharesHeldbytheOrganisationsCarryingOut Activities in the Field of Nuclear Power and OnMakingAmendmentstoSelectedLawsoftheRussianFederation”, by Russian Presidential Decree No. 556,dated27.04.2007,“OnRestructuringtheNuclearPowerGeneration Complex of the Russian Federation”, andby the Russian Government Resolution No. 319, dated26.05.2007,“OnMeasurestoFormJoint-StockCompany‘NuclearPowerGenerationComplex’”.

According to respective regulations and lawsconcerning the formation of JSC Atomenergoprom,it was determined that the Company would integrate89 enterprises with operations in all nuclear industryand nuclear fuel cycle segments, as well as threefederal-level educational establishments. The stakesin 31 federally owned companies served as thegovernment’s contributions to the authorised capitalof JSC Atomenergoprom at the time of its formation(includingthesharesinsuchcompaniesasJSCTVEL,JSC Techsnabexport, JSC Atomredmetzoloto, andothers). The rest of the companies had the status offederalstateunitaryenterprises (FSUE)andrequiredtransformation into joint-stock companies for theirintegration into thenuclearholding.Within theperiodof 2008–2011, 55 FSUEs were transformed into joint-stockcompaniesandjoinedJSCAtomenergoprom.ThiscompletedtheCompany’sauthorisedcapitalformationprocedure.

In 2011, the measures taken made it possiblefor JSC Atomenergoprom to begin forming a newstructureofcompaniesinthecivilianpartofthenuclearindustry, as well as to pursue a uniform policy in thefields of finance, corporate management, personnelmanagement,andthemanagementofmarginalassets.

As of 31.12.2013, JSC Atomenergoprom’s groupof companies had incorporated 111 companies withdifferentorganisationalandlegalstatuses.

RosatomStateCorporationisthesoleshareholderofJSCAtomenergoprom.

1.2.Managementofsustainabledevelopment

The approach to the sustained development ofJSC Atomenergoprom is based on the traditionalconcept of sustained development adopted withinthe international community and relies on a numberof guidelines that are specific to nuclear sectoractivities (e.g. ensuring nuclear and radiation safety).Intandemwiththetasksinvolvedinitsownsustaineddevelopment,JSCAtomenergopromaimstoaccomplishcertain goals related to tackling current problems ofglobal significance, such as environmental pollution,globalwarming, international terrorism, thedepletionofnaturalresources,theanticipatedshortageofenergyresources,andothers.

JSCAtomenergoprompaysagreatdealofattentionto minimising its impacts on the environment andpreserving the natural ecosystems. Numerousactivitiesarecarriedouttointroducetechnologiesthatenable consistent reductions in harmful emissions/releases and waste formation. Nuclear plants do notreleasegreenhousegasesintheprocessofelectricitygeneration.

That being said, the absolute top priority inJSCAtomenergoprom’sactivitieshasbeenthesafeandreliable operation of nuclear installations. The designand construction of NPPs relies on integrated effortsaimedatensuringsafety,studyingnaturalandhuman-induced hazards, and performing probabilistic safetyanalyses.Asrequiredbylaw,theconstructionphaseismandatorilyprecededbyassessmentsofenvironmentalimpactsfromnuclearinstallations.

The objective of JSC Atomenergoprom’s strategyimplementation is global technological leadership inthe field of nuclear power. The Company’s strategicgoals consist of maintaining and strengthening theirleadership position, thanks to the development ofinnovative technologies,andabroaderrepresentationin the key nuclear and adjacent markets. To a greatextent,thisleadershippositionisstrengthenedthrough

Mining and production of enriched uranium

Geological prospecting

Exploreddeposits

Uranium

Gas centrifuges

GC carbon fibre

Equipment NPP

UF6

EnrichedUF6

Uranium dioxide UO2

Uranium dioxide UO2

Electricity and heat

Mining Conversion Enrichment Deconversion Fuelfabrication

Energygeneration

JSC Atomredmetzoloto(Russian uranium assets) JSC Techsnabexport

Production of gas centrifuge

JSC GNTs NIIAR, JSC VNIIKhT, JSC GIREMET, and others

SCIENCE/INNOVATIONS

JSC EC RGS

JSC KhPI

JSC TVELJSC OK RSK

JSC Concern Rosenergoatom

Machineengineering

JSC Atomenergo-mash

JSC TsKBMJSC OKBM Afrikantov

United Company JSC NIAEP - JSC ASE

JSC Head Institute VNIPIET

JSC Atomenergoproekt

NPPdesign

NPPconstruction

Uranium One(overseas uranium assets)

Fabrication of fuel Electricity and heat generation

NUCLEARINDUSTRYPRODUCTIONCHAIN

JSCATOMENERGOPROMTODAY:

» theholderoftheworld’sbiggestportfolioof foreign NPP construction projects (19units);

» the world’s second largest installedcapacity holder and nuclear electricitygenerator;

» the world’s second largest holder ofuranium reserves and the world’s thirdlargesturaniumminingcompany(thejointshareofAtomredmetzolotoandUraniumOne);

» holds a 40% share in the market ofuraniumenrichmentservicesforforeign-designedreactors;and

» holds a 17% share in the nuclear fuelmarket.

JSC ATOMENERGOPROM

PROFILE


evolution inRussiaandworldwide inorder toachievelong-termandsteady improvement in thestandardoflivingfortheRussianpeople.Tothisend,theCompany,throughenlightenment,awareness,andcommunicationprojects,carriesoutvariousactivitiestoensurethattheessenceofJSCAtomenergoprom’sgoalsisunderstoodbyallthepartiesconcerned.

1.3.CorporatemanagementThe major corporate management goal of

JSCAtomenergopromin2013wasthehigh-qualityandtimely implementation of corporate procedures thatwerefullyinaccordancewithRussianlaw.

1.3.1.Managementbodies

Management bodies of JSC Atomenergoprom

K.B. Komarov was appointed as the Director ofJSC Atomenergoprom on 14.04.2010 (minutes of themeetingofJSCAtomenergoprom’sBoardofDirectorsNo.27,dated13April2010).

activitiesinthefieldofsafetyandvalueimprovement,environmental protection, and the development ofdesignsforadjacentindustries.

The key investment project of Rosatom StateCorporation and JSC Atomenergoprom is thedevelopment and commercialisation of a newtechnology platform. An innovative project namedProryv (Breakthrough) is being implemented in thenuclearindustry,whichisintendedtoestablishanuclearpower complex comprised of NPPs with fast-neutronreactors, nuclear fuel regeneration (processing) andre-fabrication facilities, and the ability to prepare allRW types for final elimination from the technologicalcycle for the purposes of environmental safety andvalue improvement in the nuclear industry. Anotherpromising field of activity is the creation of a fusionreactor, which is expected to provide mankind, withinthe next few decades, with a practically inexhaustiblesourceofenergyforcontinuedglobaldevelopment.

JSC Atomenergoprom contributes a great dealto the creation and fair division of economic value inRussia,supportsdomesticmanufacturersandserviceproviders,createsnewjobsinthenuclearindustry,andpromotes the creation of jobs in adjacent industries.The Company’s designs contribute significantly to themodernisationoftheRussianeconomy.

An important aspect of JSC Atomenergoprom’sactivities is ensuring the public’s acceptance of thenuclearindustry.TheCompany’sleadersseektosecurea public consensus on problems of nuclear power

Dateofbirth:29.12.1973

Placeofbirth:Leningrad

Education:Higher

Graduatedfrom:

LawLyceumunderUralStateLawAcademyin1992(awardedagoldmedal)andtheFacultyofJudicatureandProcuracyatUralStateLawAcademyin1997(honoursdegree).CandidateofScience(Law).

Positionsinrecentyears:

» 2000–2005:LegalandProjectManagementDirector(JSCRENOVA),FirstDeputyDirectorGeneral(JSCRENOVA),andDirectorGeneral(JSCRENOVA-Razvitiye);

» 2005–2006:DeputyHead(FederalAgencyforWaterResourcesofRussianFederation);

» 2006–2007:VicePresident(JSCTVEL);

» 2007:DirectorGeneral(JSCAtomenergomash);

» 2007–2010:DeputyDirector(JSCAtomenergoprom)andExecutiveDirector(JSCAtomenergoprom);and

» 2010–Present:ExecutiveDirector (NuclearPowerComplexDirectorate,RosatomStateCorporation),DeputyDirectorGeneral(DevelopmentandInternationalBusinessUnit,RosatomStateCorporation),andDirectorofJSCAtomenergopromonapluralitybasis.

DoesnotholdanyCompany’sshares.

BOARD OF DIRECTORS OF JSC ATOMENERGOPROM

MEMBERSOFTHEBOARDOFDIRECTORSOFJSCATOMENERGOPROMINTHEPERIODFROM01.01.2013TO31.12.2013(ELECTEDON29.06.2012ANDRE-ELECTEDON28.06.2013):

» Komarov, Kirill Borisovich;

» Lyakhova, Ekaterina Viktorovna (Chairman of the Board of Directors);

» Popov, Andrey Vladimirovich;

» Rebrov, Ilya Vasiliyevich; and

» Shpagin, Igor Georgiyevich.

MEMBERSOFTHEBOARDOFDIRECTORSOFJSCATOMENERGOPROMINTHEPERIODFROM06.06.2012TO31.12.2012(ELECTEDON06.06.2012ANDRE-ELECTEDON29.06.2012):

» Komarov, Kirill Borisovich;

» Lyakhova, Ekaterina Viktorovna (Chairman of the Board of Directors);

» Popov, Andrey Vladimirovich;

» Rebrov, Ilya Vasiliyevich; and

» Shpagin, Igor Georgiyevich.

KOMAROV, KIRILL

BORISOVICH


LYAKHOVA, EKATERINA

VIKTOROVNA

POPOV, ANDREY

VLADIMIROVICH


Placeofbirth:Yekaterinburg

Education:Higher

Graduatedfrom:

UralStateLawAcademy,EMBAUniversitetAntverpenManagementSchool


» 2008–2010:DirectorGeneral(JSCKoltsovo-Invest);

» 2010–2011:VicePresident(JSCTVEL);and

» 2011–Present:DeputyDirector(JSCAtomenergoprom)andInvestmentManagementandOperationalEfficiencyDirector(RosatomStateCorporation),ChairmanoftheBoardofDirectorsatJSCAtomenergopromonapluralitybasis.




Education:Higher

Graduatedfrom:

St.PetersburgStateUniversity


» 2003–2009:HeadoftheLegalDepartment(JSCMCCEuroChim);

» 2009–2011:Director(DepartmentforLegalIssuesandCorporateGovernance,RosatomStateCorporation);and

» 2011–Present: Director for Legal Issues, Corporate Governance, and Property Management / Director(DepartmentforLegalIssuesandCorporateGovernance,RosatomStateCorporation).



REBROV, ILYA

VASILIYEVICH

SHPAGIN, IGOR

GEORGIYEVICH



Education:Higher

Graduatedfrom:

St.PetersburgStateTechnicalUniversity


» 2008–2009:DeputyDirectorforEconomicsandControlling(JSCSCEC);

» 2009–2011:Director(DepartmentforEconomicsandInvestments,RosatomStateCorporation);

» 2010–2011:Director(DepartmentforEconomicsandFinancialControlling,RosatomStateCorporation);and

» 2011–Present:DirectorforEconomicsandFinance(RosatomStateCorporation).



Placeofbirth:Vologda

Education:Higher

Graduatedfrom:

UralStateLawAcademy


» 2007–2010:DeputyDirector(DepartmentforCorporateRelations,RosatomStateCorporation);

» 2010–2014: Deputy Director (Department for Legal Issues and Corporate Governance, Rosatom StateCorporation);and

» 2014–Present:Adviser to thestaffof theDeputyDirectorGeneral forManagementofNuclearProjects (JSCRusatomOverseas).



1.3.2.BoardofDirectors’2013performance

statement

In2013,54meetingsoftheBoardofDirectorswereheldbywayofcorrespondencevoting.

ResolutionsonthekeyaspectsofJSCAtomenergo-prom’sactivitieswereadoptedattheBoardofDirectors’meetings,includingresolutionson:

» holding,induemanner,themeetingoftheBoardofDirectors preceding the annual general meeting ofJSCAtomenergoprom’sshareholders;

» approving the budget of JSC Atomenergoprom for2013;and

» carrying out a number of resolutions to optimisethe structure of JSC Atomenergoprom’s group ofcompanies,includingresolutionsconcerning:- addingthesharesinJSCSSMULenatomenergo-

stroy, JSC SPb NIII EIZ, JSC Sibirskiy Orgstroy-proekt, and JSC VNIPIET to the authorised

capital of JSC Atomenergoprom, in exchangefor the additionally issued shares ofJSCAtomenergoproekt;

- a 100% stake in the authorised capital ofKWINDERHOLDINGSLIMITEDtobeacquiredbyJSCAtomenergoprom;

- adding the shares in JSC Atomtekhenergo,JSC Atomtrans, JSC PVO ZAES, and JSC NITsAES to the authorised capital of JSC ConcernRosenergoatom, in exchange for additionallyissuedsharesinJSCConcernRosenergoatom;

- decidingontheterminationofparticipationintheauthorisedcapitalofJSCEFKONbywayofholdingapublicauction;

- terminatingtheparticipationofJSCAtomenergo-promintheauthorisedcapitalofJSCINTERRAOEESthroughthesaleofitsstakeinthiscompanytoROSNEFTEGAZ;and

- decidingonforming(founding)ajoint-stockcompany,Rusatom–InternationalNetwork,witha100%stakeinthistobeheldbyJSCAtomenergoprom.

1.3.3.Paymentofdeclared(accrued)dividends

ontheCompany’sshares

Subsequenttotheresultofthe2012financialyear,JSCAtomenergopromhaspaidatotalof15.441.804.000roubles of dividends, as resolved by Rosatom StateCorporationasthesoleshareholder(ResolutionNo.1,dated28.06.2013).

The declared dividends were paid within the fixeddatesandinfull.

1.3.4.Auditingcommission

ofJSCAtomenergoprom

The auditing commission of JSCAtomenergoprom isin charge of supervising the Company’s financial andbusinessactivities.

Auditing commission member Position

Kurbatov,G.A. DeputyChiefAccountant,RosatomStateCorporation(asofthetimeofelection)

Blazhnova,T.V. HeadoftheConsolidatedBookkeepingDepartment,AccountingOffice,RosatomStateCorporation(asofthetimeofelection)

Zhukova,Z.A. ChiefExpert,InternalAuditDepartment,InternalAuditOffice,RosatomStateCorporation(asofthetimeofelection)

Theauditingcommission’sfindingsareprovidedinAnnex 2.

MEMBERSOFTHEAUDITINGCOMMISSIONOFROSATOMSTATECORPORATION(ASAPPROVEDON28.06.2013)

No remunerationwas paid to the members of theBoardofDirectorsinthereportingperiod.The Director of JSC Atomenergoprom receivedremunerationbasedonthecontractofemployment,and inaccordancewiththeUnifiedBranchLabourPayment Scheme established by Rosatom StateCorporation for its joint-stock companies and forsubsidiariesofJSCAtomenergoprom.

DETERMINATIONCRITERIAANDAMOUNTOFREMUNERATION(REIMBURSEMENTOFCHARGES)

FORTHEMEMBERSOFTHEBOARDOFDIRECTORS

1.4.Riskmanagement1.4.1.Corporateriskmanagementsystem

Theprocessofformingthecorporateriskmanagementsystem(CRMS)withinRosatomStateCorporationandJSCAtomenergopromwasstartedin2010.ThemajorlinesoftheCRMSevolution,asdefinedbytheRiskManagementPolicy,are:

» developmentoftheCRMSorganisationalstructure;» integrationwithbusinessprocesses;» developmentoftheCRMSmethodology;and» developmentoftheexpertiseandcompetenciesofthoseinvolvedintheCRMSoperation.

Integration with business processes

INTEGRATIONOFTHECRMSWITHPLANNINGPROCESSES

Director General

Risk committee

Risk management department/Risk officers of divisions

Risk owners at Corporation and

division level

Strategic level Ensuring risk management’s compliance with the Corporation’s corporate strategy

Tactical level Organisation of efficient operation of CRMS in accordance with the strategy and the Corporation’s established preparedness for risks

Operational level

Organisational and procedural support for the CRMS processes and management arrangements

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Uranium One Holding N.V.

JSC Techsnabexport

JSC Concern Rosenergoatom

JSC TVEL

JSC Atomenergomash

UC JSC NIAEP – JSC ASE

JSC Atomredmetzoloto

Corporation’s organisations where the organisational structure has been formed and corporate risk management processes are in effectCorporation’s organisations where it is planned to form the organisational structures and introduce corporate risk management processes

JSC Rusatom Overseas

Risk management processes Link to decision-making

Strategic planning

Mid-term planning

Budget planning

KPI establishment and evaluation

Management of major investment projects

Preparednessfor risks

Riskreport

Riskidentification

Riskmanagement

measures

Riskassessment

Goals of CRMS integration with business processes

» Regularidentificationandre-assessmentofriskwhenformingplans

» Establishmentofallowabledeviationsfromgoalsatdifferentplanninghorizons

» Timelyformationofriskmanagementplanswithdistinctdistributionsofresponsibility

» Regularmonitoringofriskeffects(observanceofpreparednessboundaries)andindicatorsthatcharacteriserisksforimplementingcompensatingmeasures

ORGANISATIONALMODELOFTHECORPORATERISKMANAGEMENTSYSTEM


Evolution of the CRMS methodology

For the purpose of further developing themethodological frameworkof theCRMS, the followingwasintroducedin2013:

» uniform requirements (guidelines) for analysingthe risks that affect the attainment of financialand business targets and that are planned inthe “Budgeting”, “Mid-term Planning”, and“Strategic Management” processes, includingthe identification and assessment of risks,identificationofriskmanagementmeasures,andthedeterminationofthelevelofpreparednessforfacing risks, streamlining monitoring activities,reviewing the risks of investment projects, andevaluating the effects of risks on the projecttargets (completion dates, project budgeting,andIRR);

» criteriaforsettingthelimitsonnon-residentbankstoreducethecreditrisksforJSCAtomenergoprom’sorganisations engaged in overseas businessactivities;and

» requirements to assess the buyer and customercredit risk under contracts for the supply ofproducts and services that suggest a paymentdelay, as well as the application of credit riskmanagement measures depending on the riskassessmentlevel.

Development of the expertise and competencies of those involved in the CRMS operation

To improve the awareness of and to enable theexchange of expertise and the development of thecompetenciesofthoseinvolvedintheCRMSoperation,asfarasriskmanagementactivitiesareconcerned,theCRMSregulatorydocuments,aswellasinformationonthe best practices adopted and the risk managementresearchresults,aremadeavailableonthecorporatewebsite.WorkshopsareregularlyheldfortheCompany’spersonnel and organisations concerning the CRMSoperationalaspects, themanagementofselectedrisktypes,andthequalitativeriskassessmenttechniques.

1.4.2.Managementofkeyrisks

Outlinedbeloware themajorresultsobtained fromthemanagementofthemostsignificantkeyrisksin2013.

Management risks and results in 2013

Theapprovedparametersofpreparednessforriskswere observed in 2013 both in terms of quantitative(financial) indicatorsand in termsofparameterswithzero preparedness for failing to observe these, suchasensuringnuclearandradiationsafety,aswellastheattainmentofstate-definedtargets.

DYNAMICSOFRISKSCOMPARED2012

(Dynamicsofrisks:

increase,

decrease,

nomajorchanges)

Risks and risk dynamics Risk management results

Financial risks

Currency risk TheCurrencyRiskManagementStrategyandtheCurrencyRiskHedgingProgrammehavebeenapproved.The Hedging Programme implementation has made it possible to minimise the risk of loss caused byunfavourableexchangeratefluctuations.

Interest risk

Againstthebackgroundofinterestrategrowthinthereportingyear,riskreductionhasbeentheresultofthefixed-ratefive-yearloanrising,withasubsequentincreaseintheaverageloanportfolioterm.Astheresult,theduedatesfortheintereststobereceivedandtheintereststobepaidhavelevelledoff.

Credit risk

Therisk increasehasbeentheresultofagrowth inthefrequencyof licencerevocationsfromproblembanksbytheCentralBank,thefailuretofulfiltheobligationstowardsJSCConcernRosenergoatomintheelectricityandpowermarket(failurestopayfortheelectricityconsumed),andageneraldecreaseintheRussianeconomygrowthrate.Tomanagetheriskstominimisethese:

» limitationofagentbanks;» guaranteesandlimitationofadvancepaymentstoexternalcounteragents;» regularmonitoringofthestatusofthedebtsreceivablebytheindustry’senterprises(includingthe

functioningofcommitteesthathandlethedebtreceivable);» credit risks assessment under contracts for the supply of products and services with delayed

payment;» creditriskmanagement(measuresdependonitsassessmentlevel)

Liquidity risk

This risk reduction has been caused by the fact that in the reporting year, JSCAtomenergoprom wasassignedaMoody’sInvestorsServiceratingofВаа2(outlookstable)andanational-scaleratingofAаа.ru.Also in 2013, JSCAtomenergoprom was assigned a long-term credit rating at the maximum possiblesovereignlevelofВВВfromFitchRatings,aninternationalratingagency,andanationallong-termratingofAAA(rus)(outlookstable).Besides, in accordance with a rating report of S&P, in October 2013, JSCAtomenergoprom receivedaconfirmationofitssovereignratinglevelofВВВ/А-2(outlookstable).


Commodity risks

Nuclear cycle products and services market risk

Thisrisk increasehasbeencausedbythecurrentstagnationofdemandandapricereductiontrend inthemarketsofNFCproductsandservices,largelyasaresultofadelaywiththeresumedNPPoperationinJapan,thenuclearphase-outpolicy,andareductionintheshareofnucleargenerationwithinthetotalgeneration insomeEuropeancountries (primarily inGermany,Switzerland,andBelgium),aswellasofthecompetitivepressuresofshalegassuppliesonnucleargenerationintheUSA,increasedcompetitionamongtheNFCmarketplayers,andconsiderableunsoldreservesheldbyuraniumproductvendorsandtraders.In2013,thespotpricesfornaturaluraniumdeclinedby21%andthelong-termpricesdeclinedby11%,withthespot-andlong-termquotationsforenrichmentserviceshavingdeclinedby17%and15%,respectively.Toensuretheriskreduction:

» agreements are reached with suppliers on pricing mechanisms that are inverse to the pricingmechanismsofcontractsinvolvingahighlevelofcommodityrisk;

» volumesoffuturebuyerordersundercontractsarejointlystudiedinadvancewithbuyers,andvolumesoffuturebuyerordersareestimatedwithregardtothehistoryofthecustomerrelationshipandthemarketconditions.Alternativesofreplacement/extracontractionarereviewed;and

» quantitativeflexibilitiesandoptionsleadingtotheharmonisationofsaleandpurchasevolumesarefixedincontractswithsuppliersofU3O8,conversionservices,andSWU.

Actually,in2013,despitethecontinueddemandandpricestagnationinthemarketsoftheNFCproductsandservices, thevolumeof the ten-yearportfolioof foreignorders forNFCproductsandserviceswassuccessfullymaintainedatthelevelofthepreviousyear.

See the International Business section and the 2013 annual reports of JSC Techsnabexport, JSC TVEL, and JSC Atomredmetzoloto for further details.

Electricity market risks

TheriskincreasehasbeentheresultofaslowdownintheeconomicgrowthrateinRussiaandhasbeenimpactedbytheexpectedabsenceofagrowthintheelectricitydemand,which,inturn,mayhaveanadverseeffectontheelectricitymarketprice.Theriskmanagementcapabilitiesarelimited.Useofderivativefinancialtools,asapotentialmanagementtool,isfairlycomplicatedduetothepoorliquidityoftradingplatforms.In2013,thegrowthintheday-aheadpriceforelectricitysoldbyJSCConcernRosenergoatomwas12.5%comparedtothelevelin2012,whichwascausedtoagreatextentbythegaspriceincreaseinRussia.

Operational risks

Risk of decrease in electricity generation

volumes

In2013:» theservicelifecharacteristicsofLeningradNPP’sUnit1wererestoredand» the Federal Tariff Service’s balance (the yearly minimum amount of electricity to be generated by

JSCConcernRosenergoatom)wasachievedtoalevelof101.6%.Morespecifically,172.22billionkWhofelectricityweregenerated.

See the Power Engineering Division section and JSC Concern Rosenergoatom’s 2013 report for further details.

Risks of industrial safety and ecology

Safeoperationoftheindustry’senterpriseswasensuredin2013(therewerenoin-serviceICUFdeviationsrelatedtopublicandenvironmentaldangers).

See the Nuclear and Radiation Safety section, Natural Capital Management section, and the annual reports of the Corporation’s organisations for further details.

Investment risk Anoptimisationofprojectswasundertakenin2013,whichresultedintheportfolio’stotalreturnsuccessfullyincreasingby1.5%.

See the Management of Financial Capital section for further details.

Political risks

Themajorriskfactorsthathamperedthedevelopmentandextensionofinternationalcooperationstemmedfromthepoliticalinstabilityinsomepartsoftheworld,thepost-Fukushimasyndromethatcontinuedtoexistinsomecountries,unfaircompetitiononthepartofsomeforeigninternationalmarketplayers,stove-pipingcampaignsinforeignmassmediaaimedatdiscreditingtheCompany’sactionsandtechnologies,andattemptstoputcertainnationallawsaboveinternationallaw.In2013,allof theCompany’skeyoverseasprojectswerecompletedorcontinuedashadbeenplanned.Furthermore, a positive indicator of the renewed interest in the development of nuclear power shownby foreign states was seen in the conclusion of 11 intergovernmental agreements and 7 interagencyarrangementsoncooperationinthepeacefuluseofatomicenergyinthefieldofnuclearsafety,scientificresearch,developmentalactivitiesinnuclearandenergysectors,andothers.

See the International Business and International Cooperation sections for further details.



Reputational risks

Theriskincreasehasbeencausedby:» negative outlooks with respect to the economic growth in Russia, which entails a decreased fiscal

capacityofRussia’smunicipaldistrictsandsubjectterritorieswherenuclearinstallationsaredeployed;» asteadilynegativedynamicoftheworld’suraniumpricelevel,whichmakesitunprofitabletomine

naturaluraniumatPriargunsky IndustrialMiningandChemicalUnion (PIMCU) in theTrans-Baykalterritory,Russia,aswellasatsomedomesticandoverseasminingprojectswithahighcostofmining,duetowhichtheCompanyhastoundertakeoperatingefficiencyimprovementprogrammes,includingtheoptimisationofPIMCU’sworkforce;and

» a“background”factoralsointheformofthecontinuedinstabilityintheaccidentresponseactivitiesatFukushimaDaiichiNPPinJapan(continuedradioactivewaterleakage).

To decrease the risk, integrated activities are under way to shape the public acceptance of nucleardevelopmentthankstogreaterawarenessandopeninteractionswithallpartiesconcerned.In2013,asshownbyasurveyconductedbyLevadaCentre,apublicopinionpollagency,theshareofthoseinfavourofthecontinueduseofatomicenergyremainedatthelevelofthepreviousyear,amountingto51.3%ofthetotalnumberofthosepolled.

See the Social Capital and Goodwill Management section for further details.

Risk of loss or damage to assets

TheCompanyoperatesanintegralbranchanti-corruptionandassetsecuritysystem.In 2013, the effect from preventative and checkout asset security activities was estimated at 5.1 billionroubles.

Compliance risks In2013,acompliancefunctionauditwasconductedwithintheindustry,whichresultedincompliancerisksbeingidentifiedandprioritised,andtheirrespectiveownersbeingappointed.Acompliancefunctiondevelopmentroadmapwasapproved.

1.4.3.Riskinsurance

Riskinsuranceisoneofthekeyriskmanagementapproaches.

The Company’s enterprises and organisationsfullymeettherequirementsofin-effectlawsandtherespectivebylawsrelatedtocarryingoutcompulsoryandimputedinsurancetypes,includingnuclearliabilityinsurance,compulsoryliabilityinsuranceofownersofhazardousproduction facilitiesandhydraulicworks,compulsory liability insuranceofownersofvehicles,liability insurance for construction and assemblyoperations,compulsorypassengerinjuryandpropertydamagecarrierpublicliabilityinsurance,andothers.To reduce the risk of financial losses from propertydamageor loss,aswellaspersonnel lifeandhealthrisks,propertyandpersonnelareinsured.

To improve the strength of insurance coverage,theCompany,togetherwiththeinsurancecommunity,carriesoutcontinuedactivitiestoenablepropertyriskreinsuranceofRussianoperatorsintheinternationalpoolingsystem.In2013,alargeportionofthenuclearliability of Russian NPPs was ceded for reinsuranceto the international pooling system, which served toconfirm that sufficient safety and reliability levelsof Russian NPPs have been recognised by theinternationalnuclearinsurancecommunity.

International insurance inspections have beenconducted at the Bilibino, Kalinin, Kursk, and KolaNPPs (with the participation of international poolingsystemexperts).Risksrelatedtonuclearfuelhandling,themanagementofNPPs,personnelqualification,firesafety, environmental surveillance, and other issueswerereviewedaspartoftheinspections.Asaresult

of these inspections, a conclusion was reached by theinternationalexpertsthatthelevelofsafetyattheinspectedNPPs was in compliance with international standards. Itwas confirmed that Russian operators could be insuredagainst property risks within the international poolingsystem. At the Kursk and Kola NPPs, the internationalinsuranceinspectionswereconductedrepeatedly;astheresult of the repeated inspections, an expert conclusionwas drawn that a fairly high level of safety had beenachievedandthatagreatdealhadbeendonetoimplementtherecommendationsfromearlierinspections.

Further insurance inspections are planned to beconductedatmajorsiteswithintheindustryin2014.

1.4.4.CRMSevolutiontasksfor2014

As part of further CRMS evolution, it is plannedthatin2014:

» formation of the organisational structure andimplementation of corporate risk managementprocesses in Uranium One Holding N.V. andJSCRusatomOverseas;

» development of the key risks managementtechnologyanditsimplementationintheoperatingandprojectactivities;

» integrationoftheinformationonrisks(reports)intothecorporatereportingsystem;

» holding of regular workshops for the Company’spersonnelanditsorganisationsbasedonRosatomCorporateAcademy.


STRATEGY AND IMPLEMENTATION RESULTS IN 2013

2 32 2.1. ACTIVITIES STRATEGY

33 2.2. FINANCIAL AND ECONOMIC PERFORMANCE

37 2.3. EFFICIENT NUCLEAR ELECTRICITY SUPPLIES FOR RUSSIAN INDUSTRIES

45 2.4. STRENGTHENING OF THE GLOBAL PLAYER POSITION IN THE GLOBAL MARKET

OF NUCLEAR SERVICES

58 2.5. NUCLEAR AND RADIATION SAFETY

2.1.ActivitiesstrategyThe “Strategy of Activities of the State Atomic

EnergyCorporationROSATOMforthePerioduntil2030”wasdeveloped in2011.TheStrategywasapprovedbytheCorporation’sBoardofDirectorson24.11.2011.TheStrategy implementation objective is to attain globaltechnologicalleadership.

The Strategy of Activities defines the following

strategicgoalsforthenuclearindustry’sciviliansector:» efficient nuclear electricity supplies for Russian

industries;» strengthening of the innovative potential for the

further evolution of Russian nuclear technologiesandfortheextensionoftheirapplicationrange;and

» strengthening the global player position in theinternational market of nuclear technologies andservices.

» ConceptoftheLong-TermSocialandEconomicDevelopmentoftheRussianFederationforthePerioduntil2020(approvedbytheRussiangovernmentresolutionNo.1662-r,dated17.11.2008);

» EnergyStrategyofRussiaforthePerioduntil2030(approvedbytheRussiangovernmentresolutionNo.1715-r,dated13.11.2009);

» MasterPlanforDeploymentofElectricityGenerationFacilities(approvedbytheRussiangovernmentresolutionNo.215-r,dated22.02.2008);

» Long-TermProgramofActivitiesbyRosatomStateCorporation(2009-2015)(approvedbytheRussiangovernmentresolutionNo.705,dated20.09.2008);and

» StrategyfortheInnovativeDevelopmentoftheRussianFederationforthePerioduntil2020(approvedbytheRussiangovernmentresolutionNo.2227-r,dated08.12.2011).

STRATEGY AND IMPLEMENTATION RESULTS IN 2013

Target Target indices for 2030

Technologicalleadership Costsofnewdevelopments–4.5%ofrevenues

Shareofnewproducts–40%

Numberofinternationalpatents–15peryearby2020

Globalscope Shareofforeignoperations–50%

Shareofforeignassets–25%

Brandrecognition–World’sTop100

Shareintheinternationalenrichmentmarket(notincludingHEU-LEU)–≥33%

ShareinthePWRreactorfuelmarket–5%

Scale ShareintheNPPservicingmarket–notlessthan10%beginningin2020

NPPpower–growthbyafactorof2.5(from25.2to60GW)

OverseasNPPconstruction–about30units

Operationalefficiency Procurementcostreduction–by30%by2015(ascomparedto2011)

Labourproductivityincreasetotheleveloftheworldmarketleaders

TARGETSFOR2030

THESTRATEGYISBASEDONTHEFOLLOWINGDOCUMENTS: » coordinationofactivitiescarriedoutbysubsidiaries

and associates, and the pursuit of a uniformscientific and technical, investing, manufac-turingand technological, financial, pricing, social andstaffing policy of subsidiaries and associates inaccordance with Russian law and their respectiveconstituentdocuments.

In long-term perspective JSC Atomenergoprompositions itself as a global technological leader in thenuclear industryandapartof theworldtop3playersinmajorsegments.TheCompanyalsoaspirestoobtaintherecognitionofitsleadershipinapplicationofnucleartechnologiesintheadjacentmarkets.

2.2.Financialandeconomicperformance2.2.1.Majorfinancialandeconomicperformancedatain2013

KEYFINANCIALINDICATORS,BILLIONROUBLES

2013 2012* 2013/2012, %

2011 2012/2011, %

Revenues 436.1 394.8 110.5 389.4 101.4

Costofsales (277.8) (269.2) 103.2 (226.8) 118.7

Grossprofit 158.3 125.6 126.1 162.6 77.2

Businessandadministrationexpenditures (78.5) (72.3) 108.5 (66.0) 109.5

Otherincomesandexpenditures(net) (19.0) (18.1) 105.3 (10.3) 174.9

Financialincomesandexpenditures(net) (9.7) 1.8 (535.8) (8.2) (21.9)

Shareinthenetprofit/(loss)ofcompaniesatequity (1.9) (0.2) 930.9 2.7 (7.6)

Profittaxexpenditures (18.0) (12.1) 148.0 (19.7) 61.5

(Loss)/profit on discontinued operations (less profittax)

(6.6) 2.2 (305.3) – –

Profitfortheyear 24.7 26.8 92.1 60.9 44.0

Otherintegratedincome/(loss) 7.1 (20.3) (35.1) 5.2 (388.3)

Totalintegratedincomefortheyear 31.8 6.5 487.3 66.2 9.9

Netoperatingprofitaftertax(NOPAT) 42.8 23.0 185.9 66.5 34.6

*The2012datahasbeenrecalculatedinconnectionwiththeentryintoforceofrevisedIAS19EmployeeBenefitsconcerningtheframeworkfordeterminationofincomesorcostspertainingtoplanswithfixedpost-employmentpayments,aswellasinconnectionwiththedisclosureoftheeffectfromdiscontinuedoperationsastheresultofthelossofcontrolofUraniumOneInc.,owingtothedealtosellashareinUraniumOneHolding.AsspecifiedinIAS,whereanoperationisclassifiedasdiscontinued,thecomparativedataintheprofitorlossstatement,orinanotherintegratedincomestatement,isshownasiftheoperationinquestionwasdiscontinuedfromthetimetherespectivecomparativeperiodstarts.

In2013,therevenuegrowthrate(10.5%)wasgreatlyinexcessofthecostgrowthrate(3.2%).

Thedynamicshiftofrevenues(agrowthof10.5%,morespecificallyof41.3billionroubles,ascomparedto2012)waspredominantlyinfluencedbythefollowingfactors:

» agrowthintherevenuesfromelectricity,capacity,andheat sales. This was caused by a favourable pricingenvironmentinthefreeelectricitymarket,acapacitypricegrowthastheresultofthecompetitivecapacityouttake,andthelaunchofthecapacitysuppliesfromKalininNPP’sUnit4;

» a growth in the revenues from the supply of NFCproducts. These changes were caused by a drop inthe market prices for uranium-containing productsand enrichment services, but were compensated byan increase in the volume of nuclear fuel supplies toforeignNPPs,includingthoseincreasesasaresultofentryintonewsalesmarkets;and

» agrowth in therevenuesasaresultofan increasedvolumeofdesignservicesforforeignNPPs.In2013, theprofitamounted to24.7billionroubles,a

decrease of 2.1 billion roubles compared to the previousyear’s respective figure (the 2012 profit was 26.8 billionroubles).

The following factors had the greatest effect on the2013financialperformance:

» anoutrunninggrowthofrevenuesascomparedtothecostgrowth,whichledtoagrossprofitincreaseof32.7billionroubles;

» the negative revaluation of shares in Inter RAO UESfor 2013 (19.4 billion roubles) was partially made upfor by the profit from the sales of said shares in theamountof5.8billionroubles,withthetotaleffect(loss)being 13.6 billion roubles (shown as part of financialexpenditures);

» an income fromrevaluationat fairvalueofshares inUranium One Holding and Uranium One Inc. as ofthedateoftheretirementintheamountof8.9billionroubles(disclosedaspartofthefinancialincome);

» the disclosure of a loss from the impairmentof assets in the amount of 31.4 billion roubles (therespective2012figurewas26.3billionroubles)aspart

ThemajorgoalsofJSCAtomenergoprom’sactivitiesare:

» implementation of Rosatom’s strategy of activitiesand the overall evolution strategy of the nuclearpowerindustrycomplex;

» an improvement in the management efficiency ofRussia’snuclearpowerorganisations;

» preservationanddevelopmentofthenuclearpowerindustry complex’s research and manufacturing

potential;» mobilisation and concentration of intellectual,

manufacturing and financial resources toimplement long-term programmes for increasingthecompetitivenessofproducts(works,services);

» profit earning, including profits in the form ofdividends (share of profit) on shares (stock,equities) in subsidiaries and associates owned byJSCAtomenergoprom;and


Thedynamicsofcost(agrowthof3.2%or8.6billionroubles, as compared to 2012) was predominantlyinfluencedbythefollowingfactors:

» agrowthinproductionpersonnelcosts(9.1%orby5.9billionroubles),whichwasprimarilycausedbytheindexationofwagesinthesecondhalfof2013toraisewagestotheconsumerpriceindexlevel;

» a growth in depreciation (9.7% or by 5.7 billionroubles), as well as the property tax charges andother budgetary payments (29.9% or by 2.6 billionroubles)astheresultofthecommissioningoffixed

assets,includingKalininNPP’sUnit4;» a decrease in the volume of manufacturing and

services provided by outside contractors (23.3%or by 7.6 billion roubles), achieved due to theoptimisation of manufacturing processes, thelaunchoftheenergyefficiencyprogramme,andtheresultsoffulfillingtheRussiangovernment’sorderto reduce the cost of purchasing goods (works,services);and

» an increase in the volume of inventories and thestockintrade(78.4%orby6.6billionroubles).

2.2.2.Coststructure

COSTSTRUCTURE,BILLIONROUBLES

Cost of sales 2013 2012* 2013/2012, %

2011 2012/2011, %

Feed,materials,andfuel 66.3 64.2 103.3 55.4 115.9

Personnelexpenditures 70.8 64.9 109.1 56.5 114.9

Costofelectricitypurchasedforresaleandauxiliaryneeds

23.2 21.6 107.4 19.5 110.8

Depreciation 64.8 59.1 109.6 60.8 97.2

Manufacturingandservicesbyoutsidecontractors

24.9 32.5 76.6 22.5 144.4

Cost of sales 2013 2012* 2013/2012, %

2011 2012/2011, %

Propertytaxchargesandotherbudgetpayments

11.3 8.7 129.9 7.1 122.5

Otherexpenditures 31.5 26.7 118.1 26.5 100.7

Changesinfinishedstockandinventories (15.0) (8.4) 178.6 (21.6) 38.9

TOTAL 277.8 269.3 103.2 226.7 118.8


ofotherexpenditures,whichwaslargelycausedby:- a reduction in the long-term forecast of uranium

prices with a resultant impairment of the miningassets in the Mining operations segment of theRussian Federation (7.6 billion roubles and 14.6billion roubles, respectively, inside and outsideRussia);and

- areducedvolumeofordersandadeterioratingsteelmarketenvironmentwitharesultantimpairmentofthe assets in the Machine Engineering operationssegment(4.7billionroubles);

» thedisclosureofthepositiveeffectfromthechangesintheestimatedvalueofdecommissioning,RW,SNF,andotherreserves(totalamountingto12.1billionroubles)aspartofotherincomes;and

» theotherconsolidatedincomefor2013amountedto7.1billion roubles, the major positive effect having beendisclosed as part of the actuarial gain on corporatepensionschemes.Thus,totalintegratedincomefor2013increasedin

companisonwith2012by25.3billionroublesandwasequalto31.8billionroubles

BREAKDOWNOFREVENUESFROMSALESTOEXTERNALBUYERS,BILLIONROUBLES

81.220.9%

61.615.8%

20.85.3%

6.41.6%

17.14.4%

202.352.0%

SEGMENTSOFOPERATIONS

2011 2012*2013

389.4 394.8 436.1

69.015.8%

68.615.7%

26.56.1%

4.91.1%

33.47.7%

233.753.6%

70.017.7%

65.416.6%

28.07.1%

4.81.2%

24.96.3%

201.751.1%

Electricitygeneration

Machineengineering

Salesandtrading

Mining

Fuel

Others


FINANCIALSTABILITYINDICATORS

Indicator 2013 2012

Ratioofborrowedandownedfunds 0.35 0.35

LIQUIDITYINDICATORS

Indicator 2013 2012

Quickratio 0.94 1.18

Currentratio 1.50 1.91

TURNOVERINDICATORS,DAYS

Indicator 2013 2012

Inventoryturnoverperiod 206 194

Accountsreceivableturnoverperiod 51 47

Accountspayableturnoverperiod 63 63

RETURNINDICATOR,%

Indicator 2013 2012

Returnonsales(ROS) 6.6 6.7

Returnonassets(ROA) 1.3 1.4

Returnonequity(ROE) 1.8 2.1

2.2.3.Majorfinancialandeconomicindicators

In the reporting year, the quick ratio decreasedby 20% as compared to 2012, predominantly due to areductioninthecashbalance.

A21%decreaseinthecurrentratiowascausedbythe outrunning growth in the short-term liabilities as

oftheendoftheperiod,ascomparedtothegrowthinworkingassets.

Nomajorchangesintheturnoverandprofitabilityratiostookplacein2013.


2.3.EfficientnuclearelectricitysuppliesforRussianindustries2.3.1. Mining Division

2.3.1.1.Strategyandactivities

ThemanagingcompanyofRosatom’sMiningDivisionis JSC Atomredmetzoloto (ARMZ Uranium Holding).Prior to 2013, the Mining Division united Russian andforeign uranium mining assets. A decision was madein 2013 to restructure the division, and Uranium OneHoldingN.V.wasformedfortheconcentrationofforeignassetsat thenuclear fuelcyclestage’s frontend.TheMiningDivisionwillprovideforthefurtherdevelopmentofassetsintheterritoryofRussia,includingnewminingprojects.Therefore,the2013uraniumminingdatawillbe disclosed in this section with respect to Russianassets (thedataon foreignassetswillbegiven in theInternationalBusinesssection).

Thepositionof theMiningDivision in theuraniummarket is supported by the guaranteed demand foritsproductsfromthenuclearenterprisesinRussia,ageographically diversified production and feedstockbasewiththeavailablereservesofanefficientminingcost, and activities undertaken for the sustainabledevelopmentofongoingandfutureprojects.

Other contributors to the evolution of the MiningDivision’s business are adjacent and associatedactivities(coalmining,heatandelectricitygeneration,production of sulphuric acid and mining equipment,drilling, design, surveying, and engineering services).The consumers of said products and services are

the Division’s manufacturing enterprises and otherorganisations controlled by JSCAtomenergoprom, aswell as other Russian and foreign organisations andenterprises.

ThemissionoftheMiningDivisionistosupportthedevelopment of advanced technologies by providingfeedstockresources. Itsstrategicgoal is tomaximisethe value of business to the shareholders’ benefitthroughensuring:

» ahighlevelofuraniumminingefficiencyand» an increase in the scale and diversification of

business through the development of new miningprojects.

2.2.4.Structureofassets

A goodwill decrease by 29 billion roubles wasthe result of the recognised loss from the goodwillimpairment with respect to Mantra Resources LimitedandJSCEnergomashspetsstal (by12.4billionroubles),aswellasinconnectionwiththewithdrawalofUraniumOne Inc. from JSCAtomenergoprom’s control throughthesaleofthecontrollingstakeinUraniumOneHoldingN.V.toanotherRosatom-controlledcompany.

Adecrease in intangibleassetsby5billionroublesresulted largely from the 2013 disclosure of the lossfromimpairmentoftheintangibleassetsintheMiningoperationssegment.

A growth in the balance cost of fixed assets by124 billion roubles occurred largely due to the capitalinvestmentswithinaffiliatedcompaniesofJSCConcernRosenergoatom.

The long-term financial investments decreased by18billionroubles(aneteffect),primarilyastheresultoftheretirementofequityinvestments(takingintoaccountthesaleofthecontrollingstakeinUraniumOneHoldingto another Rosatom-controlled company), the sale in2013ofthestakesinInterRAOUES,andthepurchaseoflong-termnotesfromJSCVTBandJSCVTB-Leasing.

Nomajorchangesunderotherassetcategoriestookplacein2013ascomparedto2012.

2.2.5.Capitalandliabilitystructure

The increase in the equity capital by 91 billionroublesin2013wasprimarilytheresultofanincreasein the authorised capital due to the placement ofJSCAtomenergoprom’s additional shares (worth 83billionroubles).

A credit and loan increase by 18 billion roubles(a net effect) was due to the loans received in 2013from JSC Sberbank of Russia, JSC VTB Bank, andGazprombank (Joint-StockCompany),aswellasduetoareduction,asoftheendof2013,intheliabilitiesthanks to the withdrawal of Uranium One Inc. fromthe Group through the sale of the controlling stakein Uranium One Holding N.V. to another Rosatom-controlledcompany.

A 17 billion-rouble increase in the debts payablewaspredominantlytheresultofgrowthintheliabilitiesundercontractsofcommission.

A reduction in the sum of reserves by 25 billionroubleswaslargelyduetoadecreaseinthereserveondecommissioningoffixedassets(by8billionroubles),as well as of the reserve on the spent nuclear fuelhandling(by10billionroubles).

No major changes took place on other itemsofliabilitiesin2013ascomparedto2012.

MAJORCHANGESINTHESTRUCTUREOFASSETS,BILLIONROUBLES

CAPITALANDLIABILITYSTRUCTURE,BILLIONROUBLES

29

1,192397

793

91

204

179

119

106

42

91

73

153

222

80

7

0

1,316

401

884

62

222

206

94

103

37

73

77

161

231

69

7

Goodwill Equity

Fixedassets Retainedprofit

Intangibleassets

Shareofminorityshareholders

Financialinvestments

LoansandcreditsOthernon-

currentassets

Accountspayable

Inventories

Reserves

Accountsreceivable

Otherliabilities

Monetaryfunds

Othercurrentassets

31.12.2012 31.12.201231.12.2013 31.12.2013

POSITIONOFTHEMININGDIVISIONINJSCATOMENERGOPROM’SNFCPRODUCTIONCYCLE

MINING DIVISION

01 - geological prospecting 02 - mining03 - ore processing

04 - conversion05 - enrichment06 - fuel fabrication

12 - NPP design, engineering, and construction

13 - nuclear power generation14 - NPP equipment servicing

07 - equipment design08 - equipment production09 - equipment supply10 - assembly and commissioning11 - service and upgrading

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NPP CONSTRUCTION AND NUCLEAR POWER GENERATION

POWER ENGINEERING

THE PRODUCTIVITY OF LABOUR WITHIN

JSC ATOMREDMETZOLOTO IN 2013 WAS

115.1% COMPARED TO THE REPORTING

PERIOD TARGET


The Fuel Division supplies nuclear fuel for 76powerreactorsin15countries,forresearchreactorsin9EuropeanandAsiancountries,andfortransportreactorsoftheRussiannuclearfleet.

TheFuelDivisionpossessestheentirespectrumof characteristics that serve to prove the division’slong-term stability in conditions of increasingcompetitionintheinternationalmarketofthenuclearfuelcyclefront-end(NFCFE)productsandservices.TheFuelDivisionincludesseparation/sublimationandfabricationprocesses,whichmakeitpossibleforthedivisiontooffertheNFCFEproductsandservicesintheformofpackagesupplies.Thisensurestheflexibilityof contract price formation and optimised transportlogistics. Highly reliable supplies are supportedby the existence of several enterprises in each ofthe NFC FE areas. Furthermore, the Fuel Divisionhas competencies in the supply of fuel for Russian-designedreactorsandWestern-designedlight-waterreactors(PWRandBWR),aswellascomponentsforforeignheavy-waterreactors(PHWR).

Strategically, the division aims to attain globalleadership in theNFC front-end marketandachieveacompetitiveglobaledgeintheNFC.

The strategic goals of the Fuel Division are to

» securegrowthintheNFCmarkets;» developthe2ndbusinesscore;» increasetheefficiencyofmanufacturingprocesses;

and» ensureitssocialandenvironmentalacceptance.

2.3.2.2.2013results

Key production results:

» manufacturingof6.866fuelassemblies(6,579FAsweremanufacturedin2012)

» creation of the first batch of experimental fuelassemblieswithadensefuelatJSCSCCaspartofthebranchindustryProryv

» supplyoftheinitialfuelbatchfortheBN-800reactorunderconstructionatBeloyarskNPPII

» manufacturingoftheKVADRATFAcartridgestobeloadedintotheforeignPWRreactorin2014

EXPLORATION

R&D, INNOVATIONS

PRE-DESIGN ENGINEERING

DESIGN OF ENTERPRISES

CONSTRUCTION OF ENTERPRISES

ACQUISITION OF SUBSOIL USER RIGHTS

GEOLOGICAL PROSPECTING

RECLAMATION AND DECOMMISSIONING

OPERATION OF ENTERPRISES:

uranium mining and production

TheMiningDivision’svaluechainisbasedonamodeloftheproductioncyclecomprisinganintegrationofinterlinkedprocesses.

Labor productivity in JSC Atomredmetzolotoamounted115,1%comparedtotheplannedfigure.

2.3.1.2.2013results

Key production results

In 2013, Russian enterprises within the MiningDivision mined 3.135 tonnes of uranium. JSC PIMCU(Krasnokamensk, Trans-Baykal Territory) mined2.133tonnesofuranium,andJSCDalur(Uksyanskoye,Kurgan Region) and JSC Khiagda (Bagdarin, Republicof Buryatia) mined 562 and 440 tonnes of uranium,respectively.

The 2013 expenditures on innovative projectstotalled 253.5 million roubles, 101,9 million roubles ofwhichwereallocatedforR&Dactivities.

See JSC Atomredmetzoloto’s 2013 annual report for further details.

Nuclear safety

As part of JSCAtomenergoprom’s programme,entitled Improvement of the Physical Protection ofNuclear Materials, Nuclear Facilities and NuclearMaterial Storages for the Period until 2015, acombinationofengineeredphysicalprotectionfeatures(CEPPF) was put into commercial operation at JSCPIMCU’sleachplant,whileconstruction,assembly,and

commissioningoperationsfortheCEPPFcreationwerecompletedatJSCKhiagda’scentralproductionsite.2.3.1.3.Plansfor2014:

» outputof2.963tonnesofuraniumbytheDivision’senterprisesinRussia

» further geological prospecting activities andcontinued pilot operations for uranium mining attheKhokhlovskoyedeposit

» handoveroftheprojectofapilotcommercialheapleaching facility at the Berezovoye deposit for thegovernment’sexpertreviewofdocuments

» field geological prospecting activities at thePavlovskoyedeposit

» development, together with foreign investors, ofthebaseconditionsforthepilotcommercialrare-earthfacilitiesatJSCPIMCU’ssite

» development of the project to build a pilotcommercial scandium concentrate productionplantatJSCDalur

2.3.2.FuelDivision


The Fuel Division comprises nuclear fuelfabrication, uranium conversion/enrichment, and gascentrifugeproductionfacilities,aswellasresearchanddesign organisations. Structurally, the Fuel Divisionincorporates 16 subsidiary and affiliated companiesbased in different constituent regions of Russia. TheholdingcompanyoftheFuelDivisionisJSCTVEL.

VALUECHAINOFTHEMININGDIVISION

POSITIONOFTHEFUELDIVISIONINJSCATOMENERGOPROM’SNFCPRODUCTIONCYCLE

FUEL DIVISION






01 02 03 04 05 06

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POWER ENGINEERING

THE PRODUCTIVITY OF LABOUR WITHIN THE FUEL DIVISION

IN 2013 WAS 104.9%

COMPARED TO THE REPORTING PERIOD TARGET


supportingitsplanstoachievealeadershippositionintheglobalmarketofnucleartechnologies.

To date, the equipment manufactured by theMachineBuildingDivision’senterprisesisinoperationinover20countriesoftheworld.Beyondthetraditionalmarkets of presence (Russia, the CIS countries, theBaltic states, and Eastern European countries), thedivision’s top-priority markets include Asian-Pacificcountries,aswellasAfrican,MiddleEastern,andLatinAmericancountries.

For increased reliability, improved economicperformanceandalongerspecifiedlifeoffacilities,thedivision’s enterprises carry out continual activities toupgradetheequipmentattheNPPsandcogenerationplants inoperation.Anemphasison thedevelopmentof hydraulic power engineering is placed on theconstruction of small and micro-hydro plants thatareexpectedtoofferaperfectalternativetoheatandnuclear power stations, as small water courses havepractically unlimited resources and are relativelyunderused.

Due to a great deal of vertical integration,the Machine Building Division is involved in NPPconstructionprojectsatallnuclearproductionprocesschainstages,fromdesign,installation,andadjustmenttoafter-salesservicingandequipmentupgrading.

2.3.3.2.2013results


» equipmentwassuppliedtoLeningradNPPII(Units1 and 2), Belorussian NPP (Unit 1), Rostov NPP(Unit3),andNovovoronezhNPPII(Units1and2)

» adecisionwasmadebyAlstom-AtomenergomashCo.Ltd.todeploytheproductionoftheturbineroomcomponentsusingaFrenchtechnology(Arabelle)basedon the facilitiesofAtommash,anaffiliatedcompany of JSC AEM-Technologii in Volgodonsk.This is expected to make the Machine BuildingDivisiononeoftheworld’sfewintegratedsupplierswiththecapabilitytomanufactureequipmentbothforthereactorandturbineNPPislands

» auniquefirst-heatingotweighing415tonnestobeused for manufacturing the extended VVER-TOIreactorvesselcoreshellwasproducedaspartoftheVVER-TOI reactor facility project implementationatthesiteofJSCEnergomashspetsstal

» retrofitting of JSC Energomashspetsstal wascompleted,whichhasmadeitpossibletoestablisha modern, energy-efficient enterprise with thecapability tomanufacturethecompletespectrumofkeyintermediateproductsforNPPcomponents

» retrofitting of JSC Petrozavodskmash wascompleted,whichhasresultedintheestablishmentof a new facility for production of the steamgenerator vessels (complete cycle) and maincirculationpumpcasingsforNPPs.Newproductswere commercialised, including the TUK-146

shippingcask,whichisintendedfortransportationandstorageofspentnuclearfuelfromreactorsoftheVVER-1000/1200type

» JSC SNIIP won two tenders for the supply ofthe automated radiation monitoring systemcomponentsfortheretrofitoftheKalininNPP(Unit1)andfortheconstructionoftheTianwanNPPinChina(Units3and4)

» technology sections of the design documentationfor the nuclear fuel fabrication plant in theKirovogradRegion,Ukraine,weredeveloped

» activities of the Centre for Modern AutomatedWelding Technologies were organised atSPASRIBMTIn improving the efficiency of the Company’s

activitiesanditsglobalcompetitiveedge,significantemphasis is placed on the implementation of theIntegrated Efficiency Improvement Programme andthe introduction of Rosatom’s Production System(RPS).

See JSC Atomenergomash’s 2013 annual report for further details.

2.3.3.3.Plansfor2014andmid-term:

» auditing of processes at the Machine BuildingDivision’senterprisesin2014

» further implementation of the Energy EfficiencyImprovementProgrammescheduledfor2010–2015

» repeated energy auditing for the development oftheEnergyEfficiencyImprovementProgrammeforthePeriodof2016–2020by2015,atthelatest

POSITIONOFTHEMACHINEBUILDINGDIVISIONINJSCATOMENERGOPROM’SNFCPRODUCTIONCYCLE

» optimisation of the technology and output ofexperimental fuel assemblies of the BN-1200 andBRESTKETVS-2andKETVS-3typeswithanitridefuel

» productionandshipmentof50 tonnesofasuper-conductingstrandfortheITERproject

» signing of a memorandum between JSC Tech-snabexportandJSCTVELconcerning interactionsas part of the project to establish the Centre forIntegrated Servicing of Foreign-Made ShippingCasksbasedonJSCUECC

» thelaunchofPhase2ofafacilityfortheproductionof lithiumhydroxide,enriched in lithium-7 isotope,atJSCNPCC

See JSC TVEL’s 2013 annual report for further details.

2.3.2.3.Plansfor2014andmid-term:

» completionofthelicensingprocedurefortheTVSA-12PLUS,analternative-designfuelassembly

» supply, within the scope of complete makeup, toKalinin-3

» developmentoftheTVS-2MFAdetaileddesignwithalternativedesignsolutions:withmixinggridsandwithprofiledgadoliniumfuelrods

» commercialisation and launch into the pilotoperationof the2MfuelassemblybatchwithpilotoperationoftheTVS-2MFAbatchwithmixinggridsatBalakovoNPP’sUnit4

2.3.3.MachineBuildingDivision


The holding company of the Machine BuildingDivisionisJSCAtomenergomash.

JSCAtomenergomash is the supplier of the keyequipment needed by JSCAtomenergoprom for theconstruction of nuclear generating facilities, thussupportingitsplanstoachievealeadershippositionintheglobalmarketofnucleartechnologies.

In 2013, JSC Atomenergomash actualised itsstrategy up to the year 2030 that suggests thetransformationofthedivisionintoahigh-techdiversifiedholdinginordertobecompetitiveintheglobalmarketandstableoverthelong-termperiod.

Structurally, the Machine Building Divisionincorporates 47 subsidiary and affiliated companiesbasedbothinsideandoutsideofRussia.Theenterpriseswithin the Machine Building Division supply keycomponents needed by JSCAtomenergoprom for theconstruction of nuclear generating facilities, thereby

MACHINE BUILDING DIVISION






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NFC FRONT END


POWER ENGINEERING

THE PRODUCTIVITY OF LABOUR WITHIN THE MACHINE

ENGINEERING DIVISION IN 2013 WAS


PERIOD TARGET

IN2013,THECORPORATEINTEGRATED

MANAGEMENTSYSTEM(IMS)INTHEFIELDSOF

QUALITY,ECOLOGY,HEALTHPROTECTIONAND

LABOURSAFETYFORCOMPLIANCEWITH

ISO9001,ISO14001,OHSAS18001

REQUIREMENTSWASSETUPINTHE

FUELDIVISION.THECORPORATEIMSHAS

UNDERGONEANEXTENDEDCERTIFICATE

AUDITINVOLVINGSEVERALSUBSIDIARIES.


2.3.4.2.2013results


» the nuclear electricity generation amounted to16.8%ofthetotalelectricitygenerationinRussia

» a total of 172.22 billion kWh of electricity wasgenerated. The target volume of the nuclearelectricity generation, as set in the balanceassignment determined by Russia’s FederalTariff Service, was 169.54 billion kWh. The extravolume of nuclear electricity generation totalled2.68billionkWh(1.6%)

» integratedarrangementswereundertakentocuttheoveralldurationofrepairs; the total timeofrepairoperationswasreducedby27daysin2013

» integrated arrangements were undertaken torecover the service life characteristics of theRBMK-1000graphitestack,whichmadeitpossibleto secure Rostekhnadzor’s permit to beginoperatingLeningradNPP’sUnit1from25.11.2013

» a programme was implemented for increasedpowergenerationattheactiveNPPunits

» a programme was implemented to retrofit theNPPs in operation. As part of the programme toextendthelifeoftheactiveNPPunits,investmentprogrammes were implemented in 2013 forextending, as planned, the service life of theBalakovo NPP’s Units 1 to 3, the Kursk NPP’sUnit 4, the Kola NPP’s Unit 4, and the KalininNPP’sUnits1and2.The investmentprojectwascompleted and a Rostekhnadzor licence wasobtained for the extended operation of Kursk-3,andsiteswereselectedforthedeploymentoftheVVER-TOIprojectunits

» fundingof2.8billionroubleswasprovidedforR&Dactivities, including those involved in innovativeprojectswithfast-neutronreactors(over1billionroubles)

» 16 intellectual property items were registered astheresultofR&Dactivitiesin2013

See JSC Concern Rosenergoatom’s 2013 annual report for further details.

Contributions to the energy security of the Russian Federation’s constituent regions

TheshareofnuclearelectricitygenerationoutofthetotalvolumeofelectricitygenerationinRussiaamountedto 16.8%. Nuclear generation is a major contributor topower generation by the unified grids in Russia (NPPsaccountfor21.7%ofthegenerationintheEuropeanpartofRussia).

2.3.4.PowerEngineeringDivision


The holding company of the Power EngineeringDivision is JSC Concern Rosenergoatom. The primeactivity of the division is nuclear electricity and heatgeneration and the operation of nuclear facilities(nuclear plants) and radiation sources, as well asnuclearmaterialandradioactivesubstancestoragesinthemannerprescribedbyRussianlaw.

The Power Engineering Division is Russia’s onlyoperatorofalleffectiveRussianNPPs,andisalsotheprimeorderingparty forallNPPsunderconstructionin Russia. This division is Russia’s largest electricity-generatingcompany,thesecondlargestintermsofthenumberofunits inoperationand in installedcapacityamong the world’s leading NPP operators, as well astheworld’ssecondlargestelectricitygenerator.

As subsidiaries, the Power Engineering Divisionis comprised of 10 active nuclear power plants andthe directorate of the nuclear plants that are underconstruction. The division also has a representativeofficeinthePeople’sRepublicofChina.

The division’s products are consumed by allenterprises and companies listed in Section 2(ElectricityandCapacityConsumers)oftheRegisteroftheWholesaleElectricityandCapacityMarketEntities,as well as any company or organisation that has dulyjoined the WEPM trading system for the purpose ofelectricityandcapacitypurchasetransactions.

ThestrategicgoalsofthePowerEngineeringDivisionareto:

» ensure safe, efficient, and reliable operationof effective NPPs, nuclear and radiation safetyof nuclear installations, as well as personnel,

public,andenvironmentalprotection;» increase electricity generation while ensuring the

requiredlevelofsafety;» implementthenuclearfuelcycleclosurebasedon

theBN-1200andVVER-TOIunitswithMOX-fuel;» implementsmallandmediumNPPunitprojects;» increase the share of nuclear generation due to

the growth in the NPP installed capacity and thegeneration of atomic energy, while ensuring therequiredlevelofsafety;

» improvetheefficiencyoftheNPPoperation;» improvetheefficiencyoftheNPPdesignandcapital

construction;and» developinternationalbusinessactivities.

THE PRODUCTIVITY OF LABOUR WITHIN THE ELECTRIC

POWER DIVISION IN 2013 WAS


PERIOD TARGET

POSITIONEOFTHEPOWERENGINEERINGDIVISIONINJSCATOMENERGOPROM’SNFCPRODUCTIONCYCLE

SHAREOFTHENUCLEARELECTRICITYGENERATIONINRUSSIA(WITHAREGIONALBREAKDOWN)

Unified gridsTotal electricity generation, million

kW·hNuclear electricity generation,

million kW·hShare of nuclear

generation, %

Russia 1,023,537.3 172,217.441 16.8

Europeanpart 791,284.2 172,001.903 21.7

CentralRussia 235,807.9 87,432.956 37.1

MiddleVolga 113,380.4 33,690.862 29.7

North-West 101,076.3 29,622.068 29.3

South 82,842.0 17,135.723 20.7

Ural 258,177.6 4,120.294 1.6

SHAREOFNUCLEARELECTRICITYGENERATIONOUTOFTHETOTALGENERATIONBYTHEUNIFIEDGRIDS

INRUSSIAIN2013,%

Russia

Europeanpart

UnifiedpowersystemofCentralRussiaUnifiedpowersystemoftheVolgaregionUnifiedpowersystemofNorth-WestRussiaUnifiedpowersystemofSouthRussiaUnifiedpowersystemoftheUralregion

16.8

21.7

37.1

29.7

29.3

20.7

1.6

POWER ENGINEERING DIVISION



12 - NPP design, engineering, and construction (function of new NPP ordering party and construction contractor)



01 02 03 04 05 06

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NFC FRONT END


POWER ENGINEERING


Safety of nuclear operations and nuclear material handling

The system of ensuring the safety of RussianNPPs based on the defence-in-depth concept formsthe framework for the Division’s technology policyand is regulated by federal NPP safety standards,taking intoaccount the IAEAguidelines.AllNPPsareequippedwithintegratedRWprocessingfacilities:theexisting RW storage spaces are retrofitted and newones are being built at the NPP sites to ensure theenvironmentalsafetyofnuclearplantsthroughoutthetimeofoperation.

2.3.4.3.TargetKPIsfor2014:

» productivityoflabour» JSC Concern Rosenergoatom’s investment

programmeperformanceindex» nuclearelectricitygeneration» EBITDA» integrated index for new products (with regard to

theefficiencyofsales,asshowninkWh)» specificsemi-fixedcostsper1kW/hourofinstalled

capacity» specificlevelledcostoftheNPPconstruction» LTIFR» no malfunctions of level 2 on the INES scale or

personnelirradiationincidentswithintheindustry

2.3.5.Capitalconstructionandengineering

The engineering and NPP construction activitiesof JSCAtomenergoprom are intended to achieve theCompany’sgoalsofensuringtheenergyindependenceof and guaranteed power supplies to the Russianpopulationandindustries,aswellasthecompetitivenessoftheNPPunitserialconstructionprojects.TheNPPdesign, construction, and engineering activities arecarried out by the following Company organisations:NIAEP–Atomstroyexport,JSCAtomenergoproekt,andJSCVNIPIETHeadInstitute.

ThecompetitiveadvantageofRussianengineeringis its extension of the best practices to all nucleardesign and construction project market players,which manifests itself in the creation of a modelcontractfortheentirecycleofpre-designanddesignactivities,aswellasamodelEngineeringProcurementConstructionManagement(EPCM)contractforpowerunit construction. EPCM projects cover engineering,supply, construction, and project managementactivities.

In Russia, as of the end of 2013, there were ninelarge power unit projects under construction at fiveNPPsites,andtherewasalsoafloatingcogenerationplant (FCP) in theprocessofbeingconstructed.Overthe next five years, JSCAtomenergoprom plans tobuildandstartupninelargeunits.Uptoeight2 large

powerunitsareplannedtobecompletedinthefuture(2019–2024).

Implementation of modern information technology in NPP construction.

Multi-D technology

To develop competencies in the construction ofnuclear and thermal power installations, a projectwaslaunchedin2013fortheadaptationoftheMulti-Dprojectmanagementsystem.

The Multi-D technology makes it possible tosimulate in detail the construction and assemblyprocessesbasedontheproject’s3Dmodel,tooptimisetheNPPconstructionasearlyas thepreproductionstage, to review various scenarios of using theavailable resources, and to alter the 3D model for

optimisingitsdesign.TheMulti-Dmodelconsistsofa spatial intellectual model of the facility, includingdrawings and 3D visualisations, the work schedulebased on performance standards, and informationon physical volumes. The Multi-D model detailinglimits are in accordance with the Level 4 activityprogresscharts.Thetechnologyoftheconstructionandassemblyplanningbasedonsuchaschedule isapplied, in a phased manner, to elevations, rooms,andassemblyareas.

2.4.1.1.TheNaturalUraniumMarket

The demand for uranium depends directly on thenuclear electricity output. In 2013, the global demandfor natural uranium amounted to 64–68 thousandtonnes.By2030,theglobaldemandfornaturaluraniumisexpectedtoincreaseto74–80thousandtonnes.

In 2013, the natural uranium mining volumeworldwide was 59.1 thousand tonnes (a 3% increasefromthe2012level).Theremainderofthedemandwascovered by secondary uranium sources (HEU-LEU,further enrichment of depleted uranium hexafluoride,regenerated uranium, etc.). Within the period until2030, uranium mining growth will follow the increasein demand, with the overall uranium mining growthpotential for the respective time span reaching95 thousand tonnes. The natural uranium marketis dominated by a stable group of leaders, which,as of the end of 2013, was comprised, apart from

TARGETMARKETSANDPRODUCTSOFJSCATOMENERGOPROM

2.4.Strengtheningoftheglobalplayerpositionintheglobalmarketofnuclearservices2.4.1.Targetmarkets

MAJORNATURALURANIUMMARKETPLAYERS,%

14ATOMENERGOPROM

21KAZATOM-PROM

15CAMECO

11AREVA

5RIOTINTO

5PALADIN

23OTHERS6

BHP-BILLITON

Value chain ProductsMarkets

Naturaluraniummarket

Uranium conversion

and enrichment services market

Nuclearfuel market

Naturaluranium Conversion

Powerengineering

market

Electricitygenerationand salesmarket

Design / engineering

Manufac-turing

Enrichment

Assembly Servicing

Fabrication ofNF compo-

nents

FAfabrication

NFcomponents

Nuclearsteamsupplysystem

FA

Operation Electricitytrading Electricity sale Servicing

Electricity

Servicing

Servicing

Power equipment

Development of mineral raw material base

Ore mining Oretreatment

Natural uranium

Natural uranium Conversion Enrichment UHF, EUP

2PlansforthereactorconstructionaspartoftheProryvproject(BREST-OD-300andBN-120)havenotbeentakenintoaccount;thesameistruefortheconstructionofapilotunitwiththeSVBR-100reactorfacility.


is comprised of Westinghouse/Toshiba, AREVA,JSCAtomenergoprom,andGlobalNuclearFuel.

Westinghousefabricatesnuclearfuelforpracticallyalltypesoflight-water(LWR)reactors,includingPWR,BWR,andVVER.Themajormarketsare theUSAandWesternEuropeancountries.

GlobalNuclearFuel(GNF),ajointventureestablishedby GE, Hitachi, and Toshiba, accounts for 17% of themarketshare.GNFcomprisestwoenterprises:GNF-J(for the Japanese market operations) and GNF-A (foroperations in all other markets). This organisationmanufacturesfuelforBWRreactors.

See JSC TVEL’s 2013 annual report for further details.

2.4.1.4.Powerengineeringmarket

The current global power engineering marketis valued at over $172 billion3 per year. By 2030, it is

expectedtogrowtoover$189billionperyear.Prior to 2013, most of the investments in the

equipment for newly built plants were in the heatpowersector.Intheperioduntil2030,thepercentageofequipmentcostsinnuclearpower,heatpower,andgas and petrochemical industries are expected toleveloff.

Trends in Russian power engineering

Intheyearstocome,theRussianpowerengineeringmarketwillbeevolvinginlinewithglobaltrends,butthenuclearpowerengineeringmarketisexpectedtotaketheleadintheperiodlastinguntil2020.

Themajorevolutionarytrendsofthenuclearpowerengineering market in Russia stem from the plans to

decommissionnewgeneratingfacilities,asprescribedbytheRussianFederationRegionalPowerDevelopmentPlan that was approved by the Russian governmentresolutionNo.2084-r,dated11.11.2013.

Apartfromthis,theRussianUnifiedEnergySystemDevelopmentPlanandProgrammefor2013–2019wasapprovedbyRussia’sEnergyMinistryin2013.

See JSC Atomenergomash’s 2013 annual report for further details.

2.4.1.5.Electricitygenerationandsalesmarket

In 2013, according to data from the WNA (WorldNuclear Association), nuclear power accounted forabout6%ofglobalenergysupplies.Asoftheendof2013,therewere437powerreactorsinoperationworldwide(totalpower,373.3GW)(withoutconsideringtheinterimshutdownofJapanesereactors),and72reactorsunderconstruction.

Thereportingyearsawthelaunchoftheconstructionof ten new units, including new units in the USA(4 units), Canada (3), South Korea (1), Belarus (1),and the United Arab Emirates (1). According to theWNA’s data relevant in the reporting period, theplans for NPP construction worldwide until 2030were estimated to be 484 units with a total powergenerationof544GW,a3%decreaseagainstthe2011estimates. According to WNA’s reference scenariopublished in 2013, the global NPP fleet will consistof 589 units with a total power of 574 GW in 2030.Asian countries had the greatest demand for theconstructionofnewNPPs.

In terms of nuclear installed capacity, JSCAtom-energoprom is the world’s second largest nucleargeneratingcompanyafterEDF,France(74GW).

In the period until 2030, AREVA and Toshiba-WestinghousewillremainthemajorrivalstoJSCAtom-energoprom, while competition from Chinese andKoreancompaniescontinuestogrow.

See JSC Concern Rosenergoatom’s 2013 annual report for further details.

JSCAtomenergoprom(accountsfor14%oftheworld’smining volume), of NAC Kazatomprom (Kazakhstan,~21%),Cameco(Canada,~15%),AREVA(France,~11%),BHP Billiton (Australia/Great Britain, ~ 6%), PaladinEnergy (Australia,5%),andRioTinto (Australia/GreatBritain, 5%). The seven largest players account forabout78%ofthetotalglobaluraniumminingvolume.

In 2013, a number of companies continued theconstructionofnewenterprisesandplan,iftheconditionsarefavourable,tolaunchproductionfacilitiesin2014atfullpower,equallinganaverageof3.046tonnesperyear.

See Atomredmetzoloto’s 2013 annual report for further details.

2.4.1.2.Uraniumconversionandenrichmentmarket

Uraniumenrichmentisamajorstepatthefrontendof the nuclear fuel cycle (NFC). The products offered

in the market include enriched uranium products(EUP) and uranium enrichment services measured inseparativeworkunits(SWU).

In 2013, the international market for uraniumenrichmentserviceshadacapacityofabout49millionSWU,withthatfigurehavingremainedapproximatelyatthesamelevelasin2012.Thedemandfortheuraniumenrichmentservices isexpected to increase to60–63millionSWUby2020andto75–85millionSWUby2030.

Apart from JSCAtomenergoprom, the world’smajor suppliers of uranium enrichment services areURENCO (Great Britain/Germany/the Netherlands),AREVA (France), and USEC (USA), having a combinedcontrolofapproximately95%ofthemarket.

In recent years, JSCAtomenergoprom hasaccounted for over a third of the supplies to coverthe demand of foreign-design reactors for uraniumenrichment services (40% in 2013). URENCO is the

Company’s major rival in the uranium enrichmentmarket.Asoftheendof2013,URENCO’stotalinstalledcapacitywas~15.3millionSWU/year.By2015,URENCOexpectstoreach18millionSWUperyear.

See the 2013 annual reports of JSC TVEL and JSC Techsnabexport for further details.

2.4.1.3.Nuclearfuelfabricationmarket

In2013,theglobalnuclearfuelmarkethadacapacityof approximately 11 thousand tonnes of heavy metal(THM),ofwhichroughly8thousandTHMisfuelrequiringuraniumenrichment(withnearly1thousandTHMbeingfuelforVVER-typereactors),and3thousandTHMisfuelforheavy-waterreactors.Dependingonthereactorfleetgrowth,thedemandforthesefuelfabricationservicesisexpectedtoincreaseto13.8thousandTHMby2020andto15.6thousandTHMby2030.

Thegroupoftheglobalfabricationmarketsuppliers

EXPLORATIONCOMPANIESCONTINUETHEACTIVE

EXAMINATIONOFPERSPECTIVEMID-TERM

PROJECTS.ACTIVEWORKSAREHELDINCANADA,

USAALONGWITHAUSTRALIA,AFRICANANDLATIN

AMERICANCOUNTRIES.GREENLANDMAYALSO

REJOINTHEGROUPOFPROMISINGREGIONS,AS

THEBANONMININGRADIOACTIVEMATERIALSWAS

REVOKEDINOCTOBER2013.

NUCLEARFUELFABRICATIONMARKETSUPPLIERS,%

(intermsofthenumberofreactorunitstowhichcomponentsaresupplied)

17ATOMENERGO- PROM

5 OTHERS

31WESTINGHOUSEELECTRICCOMPANY

30AREVA

17GNF

LEADINGCOUNTRIESINTHENUMBEROFNPPUNITSINOPERATIONIN2013

Russia

23

SouthKorea

50

Japan

58

France

104

USA

ATPRESENT,AREVAHASCOMMISSIONEDANDIS

EXPANDINGTHECAPACITYOFAPLANTBASEDON

AGAS-CENTRIFUGETECHNOLOGY,GEORGESBESSEII

(GBII),WITHTHERESULTANTCAPACITYEXPECTEDTO

REACH7.5MILLIONSWUPERYEARBYTHEEND

OF2016.

USECCLOSEDITSURANIUMENRICHMENTPLANT

WITHTHEINSTALLEDCAPACITYOF8MILLIONSWU/

YEARINJUNE2013,ANDNOWPLANSTOBUILDA

GAS-CENTRIFUGEPLANTINTHEUSA(AMERICAN

CENTRIFUGEPLANT(АСР))WITHACAPACITYOF

3.8MILLIONSWU/YEAR(ATTHER&DSTAGEASOF

THEENDOF2013).

33

3Thevolumesofthemarketsaregivenhereandhereinafterinthefixedpricesof2010.


2.4.2.Internationalcooperation

In 2013, the international activities ofJSCAtomenergoprom were aimed at building afavourable international legalandpoliticalenvironmentfor the global expansion and establishment of theCompanyasthe leader intheglobalmarketofnucleartechnologies,strengtheningnuclearsafetyandnuclearproliferation resistance, and promoting the Company’sinterestswithinternationalorganisationsandforums.

Intergovernmental and interagency agreements made in the reporting period

Work was continued in 2013 to expand theinternational legal framework for the promotion ofRussian nuclear power technologies around the globe.Thenumberofcountrieswithwhichintergovernmentalagreementsinthefieldofpeacefulusesofatomicenergywereineffectorsignedreached60.

NUMBEROFINTERGOVERNMENTALAGREEMENTSANDINTERAGENCYARRANGEMENTSMADE

IN2011–2013,SHOWNINDYNAMICS

COOPERATIONWITHMAJORPARTNERSINSTRENGTHENINGTHEINTERNATIONALLEGALFRAMEWORKIN2013

Partner countries Results of activities

Hungary AdraftagreementtobuildtwonewPaksNPPunitswaspreparedforsigning.

Finland Adraftofapeaceful-atomcooperationagreementwaspreparedforsigningtosubstitutetheframeworkagreementthatexpiredin2004.

SouthAfrica Adraftagreementonthestrategicpartnershipinthenuclearpowerindustrywaspreparedforsigning.

Mexico Aframeworkintergovernmentalagreementoncooperationinthepeacefuluseofatomicenergywassigned.

USA AnintergovernmentalagreementoncooperationinR&Dofthenuclearandenergysphereswassigned.Itspecifiestheareasofscientificand technical cooperation thatare inkeepingwith the tasks involvedwith the innovativedevelopmentoftheRussianeconomy.ForthepurposeoftheFrameworkAgreementonaMultilateralNuclearEnvironmentalProgrammeintheRussianFederation(MNEPRFrameworkAgreement),dated21.05.2003,theRussian-USIntergovernmentalProtocolandAgreement to the MNEPR Framework Agreement were signed. The Protocol is subject to ratification and hasbeendeliveredtotheRussianGovernmenttobesubmittedtotheStateDumaoftheRussianFederation’sFederalAssembly.

Belarus An intergovernmental agreement was signed concerning the early notification of a nuclear accident and theexchangeofnuclearsafetyinformation.ThiswasaimedatfulfillingtheIAEArecommendationswithrespecttotheconclusionofbilateralormultilateralarrangementsrelatedtotheConventionontheEarlyNotificationofaNuclearAccident.Anintergovernmentalagreementonnuclearsafetycooperationwasalsosigned.ThisisevidenceoftheemphasisplacedbytheRussianFederation,asthecontractorcountryfortheNPPconstruction,onnuclearsafetyissues,anddemonstratesthecapabilityandreadinessofRussiatoprovideassistanceinthecreationofanuclearsafetyinfrastructureinacountrybuildingitsfirstNPP.

Ukraine Anintergovernmentalagreementwassignedontheearlynotificationofanuclearaccidentandtheexchangeofnuclearsafetyinformation,whichaimedatfulfillingtheIAEArecommendationswithrespecttotheconclusionofbilateralormultilateralarrangementsrelatedtotheConventionontheEarlyNotificationofaNuclearAccident.

Armenia An intergovernmental agreement was signed on nuclear safety cooperation. The successful conclusion of thisagreementdemonstratestheprogressofRussian-Armenianrelationsinthefieldofnuclearpower,includingthestrengtheningofnuclearsafetyatMetsamorNPP.

France Duringthe18thsittingoftheintergovernmentalcommission,chairedbytheheadsofstatefromRussiaandFrance,aRussian-Frenchdeclarationwasadoptedonbilateralcooperationinnuclearpower.

SriLanka Amemorandumofcooperationinthefieldofpeacefulusesofatomicenergywassigned.

Israel Amemorandumofcooperationinthefieldofnuclearmedicinewassigned.

Cuba Amemorandumofcooperationinthefieldofnuclearmedicinewassigned.

GreatBritain AmemorandumofunderstandingonnuclearcooperationwassignedwithGreatBritain’sDepartmentofEnergyandClimateChange.

CJSCRUSATOMOVERSEASISASUBSIDIARYOF

JSCATOMENERGOPROMTHATWASFORMED

IN2011FORTHEPURPOSEOFPROMOTING

RUSSIANNUCLEARTECHNOLOGIESINTHE

WORLDMARKET.RUSATOMOVERSEASACTS

ASTHEINTEGRATOROFTHEINTEGRATED

OFFERINTHEFIELDOFNUCLEARPOWER,AND

LEADSTHEPROMOTIONANDDEVELOPMENT

OFRUSSIANNUCLEARBUSINESSINFOREIGN

COUNTRIES.FURTHERMORE,THECOMPANYIS

THEDEVELOPEROFOVERSEASBOO(BUILD-OWN-

OPERATE)PROJECTS.

2011 2012 2013

4 8 8 14 11 7

intergovernmentalagreements

intergovernmentalarrangements

In2013,theRussianFederationalsocontributedsignificantly to the activities of such internationalorganisations as the International Atomic EnergyAgency (IAEA), the OECD Nuclear Energy Agency(OECD NEA), the Council for the Cooperation inthe Field of the Peaceful Use of Atomic Energyunder the Integration Committee of the EurasianEconomic Community (EurAsEC), the Commissionof the CIS Member States on the Peaceful Use ofAtomicEnergy,andtheGroupofEight.

All financial obligations of the RussianFederation, as part of its international activities,werefulfilledinthereportingyear.

Plans and tasks in the extension of international cooperation and influence for 2014 and the mid-term perspective

Plansfor2014:» tofinalisetheprocessingofthecontractdocuments

with India to enable the commencement of theconstructionofKudankulamNPPsUnits3and4

» to sign intergovernmental agreements withHungary,Finland,andUzbekistan

» tocontinuenegotiationswiththeRepublicofSouthAfricaconcerning theextensionof thecontractuallegalframework

» todevelopanintergovernmentalagreementonNPPconstructioninJordan

» todevelopanewintergovernmentalpeaceful-atomagreementwithArgentinaThe major mid-term goals of JSCAtomener-

goprom in terms of international activities includepromotingwithinforeigncountriesandinternation-al organisations an integrated offer of services inthe construction and servicing of NPPs overseas,further evolving the international contract frame-work of cooperation, adhering to the internation-al commitments of the Russian Federation, andstrengtheningnuclearproliferation resistanceandnuclearsafety.

2.4.3.Internationalbusiness

2.4.3.1.TransformationofJSCAtomenergopromintoaglobalnuclearindustryleader

Achieving the global technological leadership innuclearpoweristheobjectiveofJSCAtomenergoprom’sstrategy.Onalong-termhorizon,theplanistoconsi-derably expand the scope of international businessactivities,asdefinedbythe2030targetsoftheCompanyand its organisations (see the Strategy of Activitieschapter).

Integrated offer of the NPP construction and maintenance

The Company’s key competitive advantage inthe global nuclear power market is the integrated

offerofoverseasNPPconstruction,operation,andmaintenance services. As the executive supplierof nuclear technologies, the Company offers anintegrated solution for the implementation of NPPconstruction projects and actively contributes tothedevelopmentofnuclearpowerincountrieswithnoNPPs.

Russian NPP construction projects are ofgeneration III+ and are equipped both with activeand passive safety systems. The NPP units underconstruction use a defence-in-depth concept andfullymeetthepost-Fukushimasafetyrequirements.The multiple successful operations in foreignmarkets prove that Russian nuclear technologiesarehighlycompetitive.


2.4.3.2.2013results

In the reporting year, JSCAtomenergopromcontinued to work actively on expanding its ten-year

portfolio of foreign orders. By the end of 2013, thoseorders had amounted to a total of $72.7 billion (a 9%increasecomparedto2012).

ИНТЕГРИРОВАННОЕПРЕДЛОЖЕНИЕПОСООРУЖЕНИЮИОБСЛУЖИВАНИЮАЭС

ROSATOM, responsibleintegrated

offer supplier

REGULATION AND INFRASTRUCTURE

BACK-END NFC SERVICES

ENGINEERING SOLUTION

HUMAN CAPITAL (KNOWLEDGE, SKILLS)

INDUSTRIAL SOLUTION

FINANCIAL SOLUTION

SAFETY AS THE FUNDAMENTAL CONDITION

GOALS:1 - Maximisation of the share of the project stakeholders on behalf of Rosatom2 - Maximisation of the cumulative financial result

» SNF management services» RW management services» nuclear facility decommissioning services (research reactors, NPP)

» Modern NPP designs (Generation III+)» NPP construction (equipment, construction and installation, commissioning)» NFC products (natural uranium, EUP/SWU, fuel)» Servicing (spare parts and accessories, scheduled maintenance, upgrades)» NPP operation services (Operation and Maintenance)

» Localisation of products and services» Certification of foreign national suppliers» Participation of suppliers in Rosatom’s projects in third countries

» Implementation of BOO projects» State loans» Support from ECA

» Development of scientific and research framework and university education» Training of qualified personnel, including operating personnel» Services for the NPP owner (customer) to build up NPP operation competences

» Development of the legal regulatory framework» Support for the development of required nuclear power infrastructure (power grid infrastructure, NFC facilities, etc.)

TEN-YEARPORTFOLIOOFFOREIGNORDERS(INCLUDINGEXPORTOPERATIONSBYRUSSIAN

ENTERPRISES,NOTINCLUDINGHEU-LEU),$BILLIONUSD

DYNAMICSOFTHEFOREIGNORDERPORTFOLIO

INTEGRATEDNPPCONSTRUCTIONANDMAINTENANCEOFFER

2011 2012 201366.5 50.9 72.7

28.9

24.7

12.9

19

19.5

17.8

13.6

21

34.5

24.2

14.0

19

OverseasNPPconstruction

Uraniumproducts

FAsandotheractivities

PortfolioofoverseasNPPconstructionprojects,numberofunits JSC ATOMENERGOPROM AnnualReport 2013- 50 51

MAP OF GLOBAL PRESENCE

Uranium exploration and mining

Supplies of LEU and uranium enrichment services

Supplies of nuclear fuel and its components

NPP construction

(P) Promising project

(I) Project under implementation 7

1

9

35

20

27

13

14

12

5

2

4

3

366

2911 25 33

15

8

31

18

1637

10

26

21

23

19

17

32

30

22

25

28

3 I

1 P P

P

2 I I I

4 P I

5 P I

6 I

8 I

7 P

36 I

15 I 37 P I

14 I I

16 I

18

27

P I

P

I

10

20 I

21 P

I

I PP 19 9

ArgentinaStudy of the possibilities for implementing Atucha-3 project

ArmeniaNuclear fuel supplies.Preparation of Metzamor-3 construction project for implementation

AustraliaDevelopmentof Honeymoon Deposit

BangladeshPreparation of Ruppur-1,2 project for implementation

BelarusPre-construction activities at Ostrovets-1,2

BelgiumSupply of uranium products

BrazilCooperation with Brazilian companies \s part of the IGA on cooperation in the peaceful uses of atomic energy

BulgariaNuclear fuel supplies for Kozloduy-5,6

CanadaOperation of Uranium One Inc. Headquarters (Toronto)

ChinaSupply of 6 TVS-2M reloads for Tianwan-1,2. Fuel supplies to the experimental fast neutron reactor. Supply of uranium products. Construction of Tianwan-3,4

Czech RepublicNuclear fuel supplies to Dukovany 1-4 and Temelin-1,2.

FinlandNuclear fuel supplies to Loviisa-1,2. Supply of uranium products

FranceSupply of uranium products

Germany Supply of uranium products

HungarySupplies of nuclear fuel for Paks-1,2

IndiaConstruction of Kudankulam-1,2. Preparations for the construction of Kudankulam-3,4. Nuclear fuel supplies for Kudankulam-1,2

Japan Supply of uranium products

JordanBidding for NPP construction

KazakhstanDevelopment of joint ventures AO JV Zarechnoye, AO JV Akbastau, TOO Karatau, TOO JV Betlak Dala, TOO Kyzyl Kum. Implementation of the project to establish the Uranium Enrichment Centre (Russian-Kazakh JV – JSC UEC) under the Alternative Option

MexicoSupply of uranium products

MongoliaImplementation of the Russian-Mongolian intergovernmental agreement on cooperation in natural uranium mining

Namibia

RussiaUranium exploration and mining,conversion and enrichment of uranium products, fabrication of fuel, design and construction of NPPs, machine engineering, generation of heat and electricity, nuclear facility decommissioning, RW and SNF management

SlovakiaNuclear fuel supplies to Mohovce-1,2 and Bohunice-3,4

South AfricaSupply of uranium products

South KoreaSupply of uranium products

SpainSupply of uranium products

SwedenSupplies of regenerated uranium fuel to Oskarshamn. Supply of uranium products

SwitzerlandSupplies of regenerated uranium fuel to Goesgen and Beznau. Supply of uranium products

TanzaniaDevelopment of Mkuju River project

TurkeyPre-construction activities for Akkuyu 1-4

UAESupply of uranium products

UkraineNuclear fuel supplies to Rovno 1-4, Khmelnitsky-1,2, Zaporozhe 1-6 and South Ukrainian 1-3. Construction of a nuclear fuel fabrication plant. Supply of uranium products. Preparations for implementation of Khmelnitsky-3,4 construction project

USADevelopment of Willow Creek Deposit (Wyoming) Supplies of low enriched uranium under the HEU Agreement. Commercial supply of uranium products

United KingdomSupplies of regenerated uranium fuel to Sizewell NPP

VietnamPreparation of Ninh Thuan-1 construction project for implementation

22 P

32 I

23 I I I I

24 P I P

35 I P I

30 I

31 P I

I

I P I

33 I I I

12 I P I I

13 I

11 I P

29 I I

28 I I

25 I

26 I

17 I


Results of overseas NPP construction

The portfolio of the overseas NPP constructionprojectsaccountedformostofthegrowth,primarilyduetothenewNPPconstructioncontractsthatweremade.Asoftheendofthereportingyear,thenumberofNPPunitsintheCompany’sportfoliowas19.

As of the end of 2013, operations were under wayatconstructionsitesinfivecountries,withatotalof11units under construction: the Akkuyu NPP in Turkey(four units), the Ostrovets NPP in Belarus (two units),two Tianwan NPP units in China (Units 3 and 4), theKudankulamNPPinIndia(Unit2isunderconstructionandUnit1 is in theprocessofapowerstart-up), andthe Ruppur NPP in Bangladesh (two units). Apartfromthis,documentsofentitlementweresignedasof31.12.2013 with respect to eight more overseas NPPunits,including:

» KudankulamNPP(India)–Units3and4;» NinhThuanNPPIinVietnam–twounits;

» KhmelnitskyNPPinUkraine–twounits;» HanhikiviNPPinFinland–oneunit;and» ArmenianNPP–oneunit.

Inthereportingyear,JSCAtomenergopromenteredthe international Russian-designed NPP servicingmarket, for which purpose CJSC Rusatom Service,a specialised company, started its operations at theendof2012.During2013,CJSCRusatomServicesignedcontracts with NPPs in Armenia, Bulgaria, Hungary,China,Slovakia,TheCzechRepublic,and theUkraineforactivitiestobecarriedoutrelatedtomaintenance,repair,upgrading,lifeextension,andpowerascension,aswellasthesupplyofcomponents,spareparts,tools,andaccessories.CJSCRusatomServiceformedapoolof partners, including Russian and foreign suppliersof equipment and maintenance services (over 50companies), to make it possible to respond, in anintegrated way, to requirements and requests fromforeignclients.

The Company’s overseas NPP construction plansApartfromthecurrentNPPconstructionactivities,

theCompany’s2014plansinclude:» powerstart-upoftheKudankulamNPP’sUnit2in

India;» preparationfortheimplementationoftheHanhikivi

NPPconstructionprojectinFinland;» participation in the preparation for the signing of

an intergovernmentalagreement (IGA)concerningcooperationfortheconstructionofandtheexportloaningtofundtheconstructionofthePaksNPP’sUnits5and6inHungary;

» participationinthepreparationforthesigningofanIGAregardingcooperationinNPPconstructioninJordan;

» preparatoryoperationsfor theproject tobuild theRuppurNPP’sUnits1and2inBangladesh;and

» preparationandsigningofthecontracttodevelopadetaileddesignfortheNinhThuanNPP’sUnit1inVietnam.In the mid-term, activities will be continued for

enteringnewmarkets,includingplansforcooperationwithNigeria,Brazil,SaudiArabia,theRepublicofSouthAfrica,Argentina,Indonesia,andMalaysiatopromoteRussian nuclear technologies in these countries. Forthe purpose of concentrating the competencies andresourcesfortheevolutionofbusiness,thelong-termplan is todevelopan infrastructureandanetworkofinternational representation offices that will also beopened in the regions of the Company’s top-priorityinterests.

Results of the Company’s activities in the NFC front-end markets in 2013

Foreign natural uranium market activities

In2013,theassetsintheuraniumminingsegmentwererestructured:thecompanyUraniumOneHoldingN.V. was formed to concentrate overseas assetsat the NFC front end (JSC Atomredmetzoloto willincreasinglyfocusitsactivitiesonthedevelopmentofuraniumassetsinRussia).Atotalof5.086tonnesof

uraniumwasminedbyUraniumOne’sfacilitiesinthereportingyear.

In 2013, the government of Tanzania granted aspecial licence for carrying out mining operations aspartoftheMkujuRiverproject.NegotiationsarestillinprogresswiththeTanzaniangovernmentonthetermsand conditions of the agreement, on the developmentof the deposit, and various other issues that requireregulatoryapproval.

In the reporting year, the Yuzhny Inkay mine inKazakhstan started to operate at full capacity (2.000tonnesofuraniumperyear).

Aspartoftheactivitiestoreducesensitivitytotheuraniumprices,expenditureswerereduced, includingby abandoning the Honeymoon pit in Australia andsuspending the mining output increase at the WillowCreekpitintheUSA.

Nuclear fuel supplies

ThemajoreventsinthefieldofoverseasfuelandFAsupplieswere:

» thesigningofthecontracttoextendthefuelsuppliesfortheDukovanyNPP;

» the signing of the contract to supply fuel andaccessoriesfortheTianwanNPP’sUnits3and4;

» the signing of the contract to supply fuel for thestart-upandfurtheroperationoftheHanhikiviNPP;

» successful completion of the qualification of JSCCMP (a daughter company of JSC TVEL) by theCanadian company Candu Energy Inc. as thesupplier of zirconium pressure tubes for CANDUreactors;and

» thedevelopmentbyJSCAtomenergopromand thepromotiontooperatorsofNPPswithPWRreactorsutilisingnuclearfuelofauniquedesign,knownasTVS-KVADRAT. Its design relies on a significantlevelofexperienceworkingontheVVERreactorFAdevelopment.Thesolutionsusedinthedesignmakethefuelhighlyrobustand increasethecapacityofthereactors.

POSITIONSOFJSCATOMENERGOPROMINTHEINTERNATIONALNPPCONSTRUCTIONMARKET,NUMBEROFUNITS

4

4

1

2

41 2

3

2

2

2

5

4

1

2

12

2

2

2

2

22

2

2

21

2

8

2

2010

2013

IGAsandcontracts Potentialprojects:startofnegotiations/tenderuntil2013

12units

19units

31units

32units

Projectportfolio

Projectportfolio

Tender/negotiations

Potential

Constructionnegotiations,bidding

Argentina

Brazil

RepublicofSouthAfrica

Nigeria

Egypt

SaudiArabia

Jordan

India

Bangladesh

China

Kazakhstan

ArmeniaTurkey

CzechRepublicSlovakia

Hungary

GreatBritain

Finland

Belarus

Ukraine

Vietnam

Malaysia

Indonesia

ONEOFTHEPROJECTSTOBUILDANAUXILIARY

INFRASTRUCTUREINTHEPARTNERCOUNTRIES

FORPROMOTINGITSPRODUCTSANDEXTENDING

THEBUSINESSACTIVITIESISTHEINITIATIVE

TOCREATEANETWORKOFSCIENTIFICAND

TECHNICALCENTRES.THECZECHREPUBLIC

WASSELECTEDASTHEPILOTCOUNTRYFOR

ESTABLISHINGTHESETYPESOFCENTRES.AS

PARTOFTHEPROJECT,ANUMBEROFCONTRACTS

WEREMADEIN2013WITHLEADINGEUROPEAN

OPERATORSOFWESTERN-DESIGNEDREACTORS,

ANDTHECOMPANY’SPORTFOLIOOFORDERS

WASEXPANDEDGREATLY,WHICHSERVESAS

THESTARTINGPOINTFORTHELONG-TERM

EVOLUTIONOFTHECOMPANY.

ON18.10.2013,ATRANSACTIONWASCLOSEDTO

BUYOUTTHE100%STAKEINURANIUMONE.

ASARESULTOFTHATDEAL,89.07%OFTHE

COMPANY’SSHARESWERECONSOLIDATEDAS

THEPROPERTYOFURANIUMONEHOLDING

N.V.,WHICHCONTROLSINTERNATIONALMINING

ASSETSANDPROJECTS.


At the present time, restrictions are in effect forsuppliesofRussianuraniumproducts,includingthosethatareapartofnuclearfuel,totheEUandUSmarkets.Theeconomicbasisforimposingtherestrictionswasthe desire of some European countries to supportdomesticsuppliersofnuclearfuelcycleproductsandservices, which could lose their market positions inan open trade environment, primarily in the marketof uranium enrichment services. In Russia’s opinion,the situation needs to be normalised by reachingarrangementsthatdonotruncountertotheprinciplesoffreetrade.

As requiredby theAISA, restrictionsare ineffectintheUSAforthesupplyofuraniumproducts.In2008,amendments to theAISAweresigned that introducedlimitsfortheRussiansupplyofuraniumproductstotheUSAfrom2011.Thelimitswillbeadjustedin2016and2019bytheUSDepartmentofCommerce.Mostofthesupplyingprocedureswillbeginin2014aftertheHEU-LEUagreementisover.

Export of uranium products

JSCAtomenergoprom completed its supplyagreement with the USA for low-enriched uranium(LEU) obtained by dissolving 500 tonnes of highlyenriched uranium (HEU) that was extracted fromdismantlednuclearwarheads (HEU-LEUAgreement).The LEU shipment schedules and the obligationsof supplying the LEU natural component (NC) toconsumerswerefulfilledinfullandontime;thevolumeofthe2013suppliesamountedtoover$1billion.

On 18 December 2013, the US Energy SecretarysignedadocumentthatguaranteedRussia’scompletefulfilment of its obligations under the Agreementbetween the Government of the Russian Federationand the Government of the United States of America“Concerning the Disposition of Highly EnrichedUraniumExtracted fromNuclearWeapons”,dated18February1993.

See JSC Techsnabexport’s annual report

The Company’s plans in international NFC front-end markets

Miningofnaturaluranium:» activities to optimise the operations by Uranium

One, enhance the efficiency, and cut costs at thecompanylevel

» increase in the volume of mining at the AkbastauandKharasanminesinKazakhstan,asprescribedbyproductionplansAs of the mid-term, Uranium One will continue

working to expand its existing portfolio of assets inKazakhstan and Africa to ensure mining growth forthe next three to five years. Given the capabilities ofUranium One, including a potential increase in theminingvolume inKazakhstanand the implementationoftheMkujuRiverprojectinTanzania,full-scaleuseofthe entire portfolio of assets will make it possible fortheCompanytoincreaseitsminingvolumeby50%ascomparedtothe2013level.

NuclearfuelandFAsupplies:» signingofcontractdocumentsforthefuelsupplies

oftheSlovakNPPsafter2015» supply of the TVS-KVADRAT FA batch for loading

intothePWRreactor» approvalwiththeESAofthecontracttosupplyfuel

totheHanhikiviNPPinFinland

Supplyofuraniumproducts:

» participationinthepreparationandorganisationofexchangeofnotificationswiththeUSside,whichsetthearrangementwithrespecttotheterminationoftheHEU-LEUAgreement

» consultationswiththeUSDepartmentofCommerceonpreparinganewamendmenttotheAntidumpingInvestigationSuspensionAgreement(AISA)

» preparation and exchange of notes with theJapanesesideregardingthemeasuresforcontrolofJapanesenuclearmaterialsinRussia

2.4.3.3.Cooperationwithinternationalnuclearcompanies

Throughout 2013, work was actively under way todevelopstrategiccooperationwithmajorplayersintheinternationalnuclearsector.

INTHEUSA,AGROUPOFAMERICANURANIUM

MININGCOMPANIESINSTIGATEDANANTIDUMPING

INVESTIGATIONIN1991CONCERNINGURANIUM

SUPPLIESFROMTHEFORMERUSSR,INCLUDING

THOSEFROMTHERUSSIANFEDERATION.BASED

ONTHERESULTSOFTHEINVESTIGATION,A

PROVISIONALANTIDUMPINGDUTYOF115.82%

WASINTRODUCEDFORALLURANIUMPRODUCTS

SUPPLIEDFROMEX-USSRCOUNTRIES.THIS

ACTUALLYMADEFURTHEREXPORTIMPOSSIBLE.

THROUGHNEGOTIATIONS,ATRADE-OFFWAS

REACHED,WHICHWASFINALISEDON16OCTOBER

1992,TOGETHERWITHSIXNEWCISMEMBER

COUNTRIES,INTHEFORMOFTHEANTIDUMPING

INVESTIGATIONSUSPENSIONAGREEMENT(AISA).

THEAGREEMENTABOLISHEDTHEPROVISIONAL

DUTY,BUTINTRODUCEDANUMBEROFTOUGH

RESTRICTIONSWITHRESPECTTOSUPPLIESOF

URANIUMPRODUCTSTOTHEUSA,INCLUDING

PARTSOFFINISHEDNUCLEARFUEL.IN1994,THE

ANTIDUMPINGRESTRICTIONSWERELIFTEDFOR

RUSSIA’SENRICHMENTSERVICESUNDERTHE

HEU-LEUCONTRACT(MEGATONSTOMEGAWATTS).

ACCORDINGTOTHEAMENDMENTSTOTHEAISA,

31DECEMBER2020WASAPPOINTEDASTHE

DATEFORTHECOMPLETETERMINATIONOFTHE

ANTIDUMPINGINVESTIGATIONANDTHEAISA.

2011 2012 2013 2011 2012 20133,388 3,219 3,046

EXPORTOFURANIUMPRODUCTSBYJSCATOMENERGOPROM,MILLIONUSD

REGIONALBREAKDOWNOFURANIUMPRODUCTSUPPLIES,%

1,009

2,330

1,033

2,186

1,002

2,044

50

HEU-LEU USAOther Asian-Pacific

Commercialsuppliesofuraniumproducts

WesternEurope Africa

44 48 43

2 121 15 10

33 36 47

COOPERATIONWITHINTERNATIONALNUCLEARCOMPANIESIN2013

International partner Result of cooperation

Toshiba,Japan On18.04.2013,anadditionalagreementtotheGeneralFrameworkAgreementonBusinessCooperationbetweenJSCAtomenergopromandToshibaCorporation,dated20.03.2008,wassigned,whichdefinedthenewfieldsofcooperation.

Fortum,Finland;Rolls-Royce,GreatBritain

On 05.09.2013, as part of the development of cooperation with Great Britain (with theFortumandRolls-Roycecompanies),acooperationagreementwassigned,underwhichthecompanieswillinvestigatethefeasibilityofaRussian-designedNPPtobebuiltandoperatedinGreatBritain.

AREVANP,France AspartofthecooperationbetweenJSCTVELandAREVANP,nuclearfuelandcomponentswerefabricatedatJSCMBP,usingregenerateduranium,forthePWRandBWRreactors.InSeptember2013,alsoaspartofthecooperation,aceremonyofhandingoverthe3.000thfuelassemblytotheconsumerwasheld.

NuclearFuelStateConcern,Ukraine In 2013, the development of design documentation was completed, an endorsement wassecuredastheresultofastateexpertreview,andthepracticalon-siteoperationsenteredtheactivephaseaspartofthepreparatoryperiod.TheprojectisimplementedbasedonPJSCNuclearFuelFabricationPlant,ajointUkrainian-Russianventure.

Fennovoima,Finland A contract was signed with Fennovoima, Finland to supply nuclear fuel for Hanhikivi I, anewnuclearplant,andalsoproviderespectiveservices.ThecontractstipulatessupplyingtheTVS-2006cartridgesforHanhikivi’sinitialfuellinganditsten-yearoperation,withthepotentialforthatoperatingtimetobeextended.

JSCNAKKazatomprom In2013, implementationof theUraniumEnrichmentCentre (UEC)projectwasstartedaspartofthearrangementsbetweenthepresidentsofRussiaandKazakhstan,asspecifiedintheIntegratedProgrammesofRussian-KazakhCooperationintheFieldofPeacefulUseof Atomic Energy, including provisions for the acquisition by JSC UEC, a Russian-Kazakhventure,ofa25%+1shareintheauthorisedcapitalofJSCUEIP.Aspartoftheactivities,thejointventurewillhaveaccesstouraniumenrichmentservicesofupto5millionSWUperyear.


2.5.Nuclearandradiationsafety

The mid-term and long-term tasks of JSC Atom-energopromrelatedtoensuringnuclearandradiationsafety of nuclear installations, personnel, the public,and the environment are regulated by the Long-Term Programme of Activities by the Rosatom StateCorporation (Russian government resolution No. 705,dated20.09.2008).

2.5.1.Nuclearandradiationsafetyofnuclear

installations

In 2013, the Company’s management bodiesand departments ensured the sustainable and safeoperations of the nuclear industry. There were noradiologicalaccidentsoroverexposureincidents.

In2013,therewerenoeventsofLevel2orhigher(ontheINESscale)attheCompany’ssites.Noeventsclassifiedasaccidentsor incidentsontheINESscalehavetakenplaceintheRussiannuclearindustryforthepast15years.

Nuclear plants

TherewerenoeventsclassifiedoveraLevel2ontheINESscaleatRussianNPPsin2013.

Altogether,41deviationswererecordedatRussianNPPunitsthatwereinoperationin2013.Therewere40deviationsatthe“0”/“below-scale” level,andonedeviationwasclassifiedasLevel1,withnoimpactonthepublicortheenvironment.

As compared to the two previous years, thenumberofdeviationscausedbyfailuresofelectricalcomponentsdecreasedinthereportingyear(12casesin2013,17casesin2012,and20casesin2011).Thisdecrease was the result of implementing actualisedindustry-generic measures to upgrade and replaceexpiredelectricalengineeringcomponents.

The number of unscheduled reactor trips froma critical state at Russian NPPs that involved theactuationofemergencyprotectionwas10in2013.

In 2013, there were no nuclear incidents thatinvolved radiological impacts within the scope ofNP-004-08, Provisions for the Investigation andAccounting of Nuclear Plant Malfunctions. RussianNPPs operated safely and reliably, with a generaltrend maintained towards improving the safetyofNPPs.

2.5.2.Physicalprotectionofnuclearand

radiation-hazardousinstallations

Security and physical protection of the Company’snuclearandradiation-hazardousinstallations(NRHIs),andofthenuclearandradiationmaterialsinuseorinstorage,includingthoseintheprocessoftransportation,

is ensured in accordance with Russian regulatoryrequirements. The activities aimed at ensuring thereliablephysicalprotectionoftheCompany’sNRHIsarecarriedout inanintegratedmannerandonaplannedbasis.

All NRHIs within the industry have valid nuclearlicences,whichisevidencethatthemandatorylicensingprerequisite (ensuring the required level of physicalprotection)issatisfied.Nocasesoflicencecancellationhavebeenrecordedtodate.

Therewerenosuccessfulcasesofnuclearmaterialtheftorunauthorisedintrusionintotherestrictedareaforactsofsabotage.

2.5.3.Readinessforemergencyresponse

Toensurethesafeoperationofnuclearinstallationsandtoprotectthepersonnel,thepublic,andlocalitiesagainst potential accident (emergency) effects, anemergency prevention and response system is inoperation within the industry. This is a functionalsubsystem of the national emergency prevention andresponsesystem.

The readiness level of forces and means, as wellas the completeness and realism of the emergencyresponseplans,isassessedasapartoftheCompany’sexercisesanddrills.In2013,therewere271emergencyresponse, special tactical, and command and staffexercises and drills conducted within the industry,including70conductedatnuclearplants.

2.5.4.Industryautomatedradiationsituation

monitoringsystem(ARMS)

One of the most important components of thesystemforthestatecontrolofradiologicalconditionsintheNRHIdeploymentareasistheindustryautomatedradiationsituationmonitoringsystem(ARMS),whichis

operatedaspartoftheRussianFederationUnifiedStateAutomatedRadiationSituationMonitoringSystem.

TheARMSiscomprisedof26on-siteARMSsystemsoperated by nuclear enterprises and organisations,includingallNPPs,with355fixedpostsintotal.Long-term measurement data indicates that the NPPcontribution to the measured background radiation isnegligiblysmallduringnormaloperation,andthattheradiological conditions at the measurement locationsarewithinthenaturalbackgroundradiationrange.

TheARMSradiationmonitoringdataispubliclyavailableinrealtimeonthewebathttp://www.russianatom.ru/.

2.5.5.Safetyoflabour

Workplace injuries

Extensive work is carried out withinJSCAtomenergopromanditsorganisationstoreducethe number of workplace injuries and the negativeeffectsofharmfulproductionfactorsonpersonnel.

In2013,theoccurrencerateofworkplaceinjurieswithinthenuclearindustry(thecoefficientKrreflectsthe number of workplace injury cases per 1.000employees)wasnot inexcessof therespective2012figure,andwasapproximately4timeslowerthanthenationalaveragelevel.

2.5.6.ExposureoftheCompany’spersonnel

AproductionfactorspecifictoJSCAtomenergoprom’sfacilitiesisionisingradiation.

The personnel radiation safety criteria are statedand set in effective radiation safety regulations(RSR-99/2009), basic sanitary radiation safety rules(BSRSR-99/2010), and other regulatory documents.Mostofthesitesmeettheserequirements.

Personnel exposure doses

The annual average effective dose (AAED) of thepersonnelexposurewithinthe industrywas1.67mSv,withnomajorAAEDvariationshavingtakenplaceoverthepastfiveyears.

No cases of the specified base dose limits5 beingexceededwererecordedintheindustryin2013.Annualeffective doses in the range of 20 to 50 mSv werereceivedby19persons.

The personnel do not include people with acumulativeeffectivedose4ofover100mSvforthepastfive consecutive years. For approximately half of the

THESAFETYSTATUSOFNUCLEARINSTALLATIONSISASSESSEDBASEDONTHENUMBERANDTHESCALEOFTHEMALFUNCTIONSRECORDED,ASCOMPAREDTOTHEIAEA-DEVELOPEDINTERNATIONALNUCLEAREVENTSSCALE(INES).THISSCALEHASSEVENLEVELSOFEVENTCLASSIFICATION:THEUPPER-LEVELEVENTS(LEVELS4TO7)AREREFERREDTOAS“ACCIDENTS”,WHILETHELOWER-LEVELEVENTSAREREFERREDTOAS“INCIDENTS”(LEVELS2AND3)OR“ANOMALIES”(LEVEL1).THEEVENTSCONSIDEREDTOBEOFMINORSAFETYSIGNIFICANCEARECLASSIFIEDASBELOW-SCALE(LEVEL0)EVENTS.EVENTSTHATDONOTRELATETOSAFETYARECONSIDEREDTOBE“OUTOFSCALE”.

UNDERTHE2012–1014INDUSTRYAGREEMENT

ONNUCLEARPOWER,INDUSTRYANDSCIENCE,

EMPLOYERSWITHINTHENUCLEARINDUSTRY

FUNDACTIVITIESTOIMPROVETHECONDITIONS

ANDTHEPROTECTIONOFLABOURATTHEIR

RESPECTIVEFACILITIESINANAMOUNTOFNO

LESSTHAN0.5%OFTHETOTALMANUFACTURING

COSTS.

COMPARATIVEDATAOFWORKPLACEINJURIESINRUSSIAANDWITHINTHENUCLEARINDUSTRYFROM2003–2013

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Russia

Rosatom

4ThedoselimitforpersonnelinGroupAis20mSvperyearonaverageforanyfiveconsecutiveyears,butnomorethan50mSvperyear.

3.9

3.4

3.12.9

2.72.5

2.1 2.2 2.2 2.1 2.0

1.3

0.81 0.83 0.84 0.84 0.81 0.880.69

0.820.57 0.51


personnelintheindustry(53%),theexposurewasnotinexcessofthebasedoselimitspecifiedforthepublic(1mSv/year).

Estimated individual personnel risk

In 2013, the ARMIR system (Automated systemto measure individual radiation risks) was usedat nuclear sites to estimate individual radiologicalrisks. This work is aimed at further optimisingthe radiological protection of personnel and atimproving the efficiency of medical insuranceto direct it at named assistance to persons in ahigh-riskgroup. In2013,using theARMIRsystem,personal data of 91% (91.4% in 2012 and 90.4% in2011) of the total workforce subjected to personalradiation monitoring was processed. The relativenumber of people with a high individual risk was1.25%(1.3%in2012).

2.5.7.Publicexposure

According to data from the radiological andmedical certification in Russia in 20125, the extraoccupationalexposureinthenuclearplantdeploymentareas (with a total population of 2.3 million) was0.004 mSv/year per person. The risk of negativestochastic effects (malignant tumours) at such anexposure level was below 5.7·10–7. This is 150 times

lower than the acceptable risk level set by effectiveradiationsafetyregulations(1.0·10–5).

In2012,theaverageannualeffectivepublicdoseofexposure fromallsourcesof ionisingradiation inRussia amounted to 3.9 mSv/year per person. Thekey factors of this public exposure in the RussianFederationarenaturalandmedicalsourcesofionisingradiation. The contribution from the enterprisesusingnucleartechnologiesisestimatedathundredthsofonepercent(0.04%or0.002mSv/year)oftheannualaverage effective exposure dose from all sources.This level of public exposure dose is representativeof all localities where large radiation-hazardousfacilitiesaredeployed.

0.04enterprisesusingnuclear

technologies

0.22 technogenicbackground

CONTRIBUTIONOFDIFFERENTSOURCESTOTHEANNUALAVERAGEPUBLICEXPOSUREDOSE

INTHERUSSIANFEDERATIONIN2012,%

5Atthetimeofthereportcompilation,theresultsofthe2013radiologicalandmedicalcertificationwereintheprocessofbeingpreparedforpublication.TheywillbepublishedbyRospotrebnadzorintheautumnof2014.

PERSONNELEXPOSUREIN2003–2013,MSV/YEAR

Collectiveexposuredoseforpersonnel,Person*Sv Theannualaverageeffectivedoseofthepersonnelexposure,mSv

2003200220012000 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

3.25

2.78

2.84

2.50

2.45

2.28

2.24

2.10

2.01

1.74

1.72 1.76

1.7

1.67184.6 192.3

172.1 168.4 156.9 155.4 153.3 143.7122.3 120.7 120.2 116.3 113.0

85.3 naturalsources

14.44 medicalsources

206.2


3EFFICIENCY OF CAPITAL MANAGEMENT

64 3.1. MANAGEMENT OF FINANCIAL CAPITAL

67 3.2. MANAGEMENT OF MANUFACTURED CAPITAL

70 3.3. MANAGEMENT OF HUMAN CAPITAL

76 3.4. MANAGEMENT OF SOCIAL AND REPUTATIONAL CAPITAL

84 3.5. MANAGEMENT OF NATURAL CAPITAL, ENVIRONMENTAL SAFETY,

AND PROTECTION OF THE ENVIRONMENT

3.1.Managementoffinancialcapital

The management of the financial capital includesimplementation of the financial strategy, managementofinvestmentoperations,andperformanceofactivitiesto improve the efficiency of financial and economicoperations.

3.1.1.Managementoffinancialactivities

The prime objective of the financial strategy isto ensure the financial stability of the Company andits organisations in the changing conditions of theenvironment, as well as to organise financing andthe management of financial risks as efficiently aspossible.

To improve the efficiency of treasury functions,thefollowingactivitieswerecontinuedin2013:

» concentrationoftemporarilyredundantcashontheaccountsofthepoolleaders;

» improvingtheaccuracyofpaymentplanning(rollingpredictionofliquidity);

» ensuringthecostoftheconsolidateddebtportfolioservicingatacompetitivelevel;and

» centralising the treasury operations (fulfilment ofthefinancialpolicyrequirements).

Key results of 2013

Thetop-prioritytasksin2013werethoseinvolvedin raising the efficiency of cash management withinJSCAtomenergoprom’sorganisationsdueto:

» theaccuracyofmanagerialdecisions;» increasingtherateofmanagerialdecision-making;

and» reducing the labour input in the delivery of

information.

Corporation Settlement Centre, a treasuryinformation system encompassing 127 nuclearenterprises, was commissioned in 2013. The use ofthe information system has contributed to greatlyreducingthelabourinputintheformationoftreasurymanagement reports, as a result of which theprocess of collecting and consolidating reports fromsubordinateorganisationswasfacilitated.

To ensure the liquidity for the timely and overallfinancing of the investment programme of nuclearorganisations under the best possible terms andconditions,worktocentralisethetreasuryoperationsand develop intra-group financing, which began in2009–2010,wascontinued in thereportingperiod. In2011–2013,theeconomiceffectfromtheutilisationofintra-groupfinancingacrosstheindustryamountedtoapproximately9.8billionroubles.

Toreducethecostofdocumentaryoperationsandloans,suretyshipscontinuedtobeusedtosecurethereturnontheadvanceandthecontractualobligationswhen carrying out procurement operations usinginternal and extra-budgetary funds, as well as toreducethecostoffundraising.Thesesuretyshipsledtoensuredsavingsin2013onthecommissionpaymentsunder bank guarantees and on loan interests in theamountof1.6billionroubles.

Financial management plans for 2014 and the mid-term

Given theexistingriskof thedebt load togrowasaresultofexternalfactors,itisplannedto:

» maintainadistinctrepaymentdisciplineintermsofintra-groupfinancing;

» improve the accuracy of mid-term cash flowplanning;

» avoid internal competition between organisationsfortheloanresources;

» continue activities for centralising cash flowmanagement;

» focus on the relationships with the base banksthat are the most reliable partners based on theavailabilityoffunding,bothintermsofamountandcost;and

» strictly adhere to the obligations, including thefulfilmentofcovenants, towardsexistingcreditors(including on the Company’s co-loan) and ratingagencies.

3.1.2.Interactionwithratingagencies

The ratings of JSC Atomenergoprom mirror theratingagencyexpectationsofa“veryhigh”probabilitythattheholdingwillreceivetimelyandsufficientstatesupport, if required. Furthermore, the company’ssolvency is positively influenced by its verticallyintegratedbusinessmodel,bytheguaranteedmonopolyintheciviliannuclearindustryinRussia,andbyitsfirmpositions in the NPP construction, uranium mining/conversion/enrichment, and fuel assembly fabricationmarkets.

EFFICIENCY OF CAPITAL

MANAGEMENT

Given the capacity of the industry’s investmentprogramme,highratingsareessential for loanstobeacquiredforlongertermsandatlowermarketrates.In2011–2013,thesavingsonthefreecreditportfoliorateamountedto270–350millionroublesannually.

3.1.3.Managementofinvestmentactivities

Approachtoinvestmentmanagement:

» collegial decision-making on investments byRosatom’s Investment Committee and by theinvestment committees of the divisions (the leveloftheinvestmentdecision-makingdependsontheproject’sstrategicimportance);

» formation of the yearly and mid-term ProjectPortfolioasapackageofnuclearprojects,anditsannualactualisation;

» supervision,atthelevelofJSCAtomenergoprom,oftheprojectprogresswithinnuclearorganisations;

» decision-making on the milestones for majorprojects, and the supervision of projectimplementationatthelevelofJSCAtomenergoprom;

» useofa“gating”approachfortheimplementationandsupervisionofprojects;and

» collection of expert opinions for improving thequalityofinvestmentdecision-makingasapartofmajorprojects.

Key results of 2013:

» theProjectPortfoliowasactualisedfortheindustry’sorganisationsforaperiodlastinguntil2018

» theefficiencyoftheProjectPortfoliowasassessed,whichhasmadeitpossibletosetthelevelofrequiredprofitabilityfromprojectsandtomakeinvestmentdecision-makingmoretransparent

» a motivation system was developed to promotetheimprovementoftheProjectPortfolioefficiencyindicators, with target key efficiency indicatorsof investment activities set for the industry’s topofficials

» a mechanism was defined for the integratedauditingofprojects,whichmakesitpossibletoformrecommendations on improving project planningand implementation; a field feasibility study wasalso conducted regarding project implementationandpost-investmentsupervision

» aunifiedindustryinvestmentsystemwasintroduced» a unified industry project decision-making

interaction procedure was put into operation forgoverning,amongotherthings,theproceduresforand the duration of functional expert reviews, aswellasformakingitmandatorytotakeintoaccounttheopinionsoffunctionalexpertsandofthepartiestakinginterestinthegivenproduct.

LISTOFJSCATOMENERGOPROM’SCREDITRATINGSASOF31.12.2013

Rating agency Rating level

Standard&Poor’s » Long-terminternationalrating–BBB» Short-terminternationalrating–A-2» Nationalrating–ruAAA» Ratingoutlook–Stable

Rating confirmation date: 21.10.2013.

FitchRatings » Long-termissuerdefaultforeign-currencyrating–BBB» Long-termissuerdefaultlocal-currencyrating–BBB» Short-termissuerdefaultforeign-currencyrating–F3» Nationallong-termrating–ААА (rus)» Short-termissuerdefaultlocal-currencyrating–F3» Ratingoutlook–Stable

Rating assignment date: 20.08.2013

Moody’sInvestorsService/JSCMoody’sInterfax » Long-terminternationalrating–Baa2» Nationalrating–Ааа.ru» Ratingoutlook–Stable

Rating assignment date: 02.08.2013

MAJORAREASOFINVESTMENTSIN2013

Major areas of investments

MiningDivision » developmentoftherawmaterialbaseandnaturaluraniummininginRussia» leadershipinuraniumminingandprocessingtechnologies» diversificationintostrategicandinnovativematerials

UraniumОneHolding » developmentoftheglobalrawmaterialbaseandnaturaluraniumminingbasedonaglobalgrowthplatform


Plans for 2014 and the mid-term

The short- and mid-term plans provide forthe undertaking of measures aimed at improvingthe efficiency of the Project Portfolio through thedevelopment of the design documentation qualitymanagementandimprovementsystem,including:

» development(detailingandmoreaccuratedefinition)of regulatory and procedural documentation ondesign management processes, along with theformalisationofresponsibilitiesindesignactivities;

» standardisationoftheinvestmentdecision-makingprocessforprojectsatdifferentprojectstagesandfordifferentprojecttypes;

» perfectionofthesystemforcontrolofthetargetedinvestments,particularlyintermsofefficientuseofsaidinvestmentsintheprojectscope;

» replication of the decision on automating theinvestmentreportingsystem;

» establishment of a single investment and designmanagementknowledgestore;

Major areas of investments

FuelDivision » supportandoptimisationofthenuclearfuelfabrication» supportandoptimisationoftheseparationandsublimationactivities» R&Dindevelopmentofnewnuclearfueltypesandthefuelcycle» R&Dindevelopmentandperfectionofgascentrifugesandnewauxiliaryequipmentmodelsfor

separationfacilities» developmentofnon-nuclearproductionactivities

Salesandtrading » developmentofanindustrytransportinfrastructure,includingthepurchaseof30V-typecasksforthetransportationofuraniumproductsasapartofformingacorporatetransportequipmentfleet

» safetyoftranshipmentandtransportationofuraniumproducts» perfectionoftheinformationprotectionsoftwareandhardwarepackage» organisationofaremotebackupsystem

MachineBuildingDivision » improving the competitiveness of nuclear enterprises based on an integrated efficiencyimprovementprogramme

» development of manufacturing competencies in the heat power, gas, and petroleum chemistrysectors

» implementationofretrofitprogrammes

PowerEngineeringDivision » constructionofNPPunitsandtheconstructionoffloatingnuclearcogenerationplants» implementationofprojectsandactivitiesateffectiveNPPunitsforextendingthelifeofgenerationI

andIIunits,theprogrammeentitled“EnsuringSafeandSteady-StateOperationofEffectiveUnits”» implementationofspentnuclearfuelandRWhandlingprojects» implementationofotherinvestmentprojectsandactivities,includingR&D,planning,andsurveying

activitiesfornewNPPsites,amongothers

Overseasconstruction » providingconstructionsiteswithrequiredhigh-capacitymechanisms,aswellaswithbuildingandassemblyimplementsandtools

» formationanddevelopmentofaffiliatedinfrastructuresatnewNPPconstructionsitesandatthecompanyheadquarters

» purchaseofequipmentandtechnologyforsurveyingoperations,monitoringofconstruction,andoperationoftheprojectattheconstructionsite

» developmentofthetelecommunicationandITinfrastructure,purchaseofadvancedsoftwarefordevelopingkeydesignandengineeringcompetencies

» extension of competencies in the construction of complex engineering projects by purchasinginterestsinbuildingcompanies

ConstructioninRussia » constructionsiteequipmentforconductingconstructionandassemblyoperations» formationofaffiliatedinfrastructuresofnewNPPconstructionsites» replacementoffixedassetsforincreasingtherateofconstruction» developmentoftheITinfrastructureandsoftware,R&Dforimprovingthequalityofproducts,and

aphasedtransitiontoindustrialconstructionpractices» completionofsociallyimportantfacilitiesregionally» extensionofproductioncompetenciesandobservanceoffederalsafetylaws

*Outofallthesourcesoffunding,notincludingintra-groupturnoverswithinRosatom’sorganisations,fortheconsolidatedorganisationsinaccordancewiththeeffectivebudgetingscopeasof31December,asreducedtocomparableconditions.

FUNDINGVOLUMESFORINVESTMENTACTIVITIESWITHINTHECOMPANY’SORGANISATIONSIN2013

Actual volume of project funding*, billion roubles, VAT included

ElectricPowerDivision

9.1 46.4 27.8 1.20.2 1.84.8 236.6

Min

ing

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Fuel

D

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Ove

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Cons

truc

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Sale

san

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Cons

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Rus

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UraniumОneHolding

Mac

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Bui

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» improvementofthecompetenciesoftheinvestmentanddesignstakeholders;and

» adjustment of the current processes and thecompletion of the current base of regulatoryand procedural documents related to the aboveadjustments.

3.2.Managementofmanufacturedcapital

3.2.1.Improvementofenergyefficiency

Energy saving and the improvement of energyefficiency is a top-priority activity that contributes toincreasedcompetitivenessofnuclearorganisations inthe target markets through a reduction in the cost ofproductsandservices.

Tostreamlinetheactivities intendedtoreducetheexpenditures on energy resources and improve theenergy efficiency of nuclear organisations, a numberof regulatory documents were developed to provideenterprises with a single procedural framework,given the requirement for defining the mechanismsand algorithms to calculate the amount of the energyresourcecostreduction.Aspartoftheactivitiestobuildasystematicapproachtoimprovingtheenergyefficiencyoforganisations,unifiedtargetvaluesweredevelopedfor a five-year period (2010–2015) and mechanismswereidentifiedtoachievethepresetparameters.

Approaches to improving energy efficiency within the industry

To identify the potential key areas of energyefficiency,withregardtotherequirementsofRussianFederalLawNo.261-FZ,energysurveyswereconductedin2010–2013withinallnuclearorganisations.Theresultof the surveying activities was that the ProgrammeforEnergySavingandEnergyEfficiency Improvementwithin Nuclear Organisations for the Period of 2012–2016wasdeveloped.

To improve the reliability of the data obtainedfrom organisations concerning the saving of energyresources,monitoringoftheenergy-savingprogrammeprogress, and the assessment of the efficiency ofthe measures taken, an automated energy efficiencymanagementsystem(referredtoasAEEMShereinafter)has been introduced within JSC Atomenergoprom’sorganisations, which, among its other key functions,provides for the integration of data with the EnergyEfficiencyStateInformationProgramme.

In2013,theAEEMSwasputintopilotoperationat38sitesofJSCAtomenergoprom,including:

» thePowerEngineeringDivision–10sites(allNPPs);» theFuelDivision–11sites:» theMachineBuildingDivision–7sites;» overseasconstruction–1site;and» constructioninRussia–2sites.

A 22.2% reduction in the cost of energy resource

consumption in 2013, as compared to 2009, the baseyear,wasachievedasaresultofinvestmentactivities.The total savings in 2010–2013 amounted to 13.9billion roubles, while the investments made in theimplementationofmeasuresbynuclearorganisationsforthepurposeofenergysavingandenergyefficiencyimprovementtotalled9.2billionroubles.

Introduction of the energy management system within organisations

To improve the quality of energy cost reductionand energy efficiency improvement management, anenergy management system has been in place sincemid-2012withinJSCAtomenergoprom’sorganisationsbased on the requirements of ISO 50001:2001, anew international standard. As a result, in 2013,Rosenergoatom underwent a certification procedurewithDQS,aninternationalcertifier.WorkisalsounderwaytorestructuretheenergymanagementsystematJSCTVELaccording to therequirementsof theabovestandards.

Plans for 2014 and the mid-term

Thefirstenergyauditwasconductedin2010–2013and encompassed 113 nuclear organisations. Anotherenergyauditisexpectedtobeconductedin2015–2016forthepurposeofaccomplishingthefollowingtasks:

» developing a new energy certificate for fuel andenergyconsumers;

» acquiring objective data on the amount of energyresourcesusedbyconductinganassessmentofthefuelandenergyconsumptiondynamics;

» supervising the measures taken and updatingthe existing energy saving and energy efficiencyimprovement programme, taking into accountthe reorganisation of enterprises, as well as thereconstructionofthemainprocessequipment;

» determining variations in the indicators for theperiod following the previous energy survey, as

MAJORCONSUMERSOFENERGYRESOURCESWITHABREAKDOWNBYTHECOMPANY’S

MAJORDIVISIONS,2013% of overall energy consumption costs

JSCTVEL JSCARMZ

JSCConcernRosenergoatom

JSCAtomenergomash

46.2 % 5.2 % 3.5 % 45.1 %


MODELFORMANAGINGTHETOTALCOSTOFOWNERSHIPOFDURABLEEQUIPMENTINTHENFCANDNPPLIFECYCLE

wellasanassessmentofthefuelandenergycostreductionforthegivenperiod;

» an in-depth audit of selected processes andenergy consumers, and the introduction of newtechnologies and solutions in the field of energyefficiencyimprovement;

» determiningtheenergysavingandenergyefficiencyimprovementpotential;

» developing individual five-year energy efficiencytargetsforeachenterprise;

» developing a list of the energy saving and energyefficiencyimprovementmeasures,acostestimationforthese,andthecalculationofthepaybackperiodsforthesaidmeasures;and

» determining the correctness of the physical dataentry in the AEEMS, and reviewing the targetachievement calculation techniques approved byorganisations.

3.2.2.ManagementoftheNFCandNPPlifecycle

The purpose of the NFC and NPP lifecycle projectmanagementistoprovidesupportfortheachievementof JSC Atomenergoprom’s goals by implementing theCompany’s policy that enables decisions to be madebasedontheincomeandcostestimationforthewholeof the lifecycle, themanagementof theNFCandNPPlifecycleprojects,and theorganisationof interactionsamongallNFCandNPPlifecyclestakeholders.

In 2013, the launch of the Lifecycle ManagementSystem(LMS)required:

» themajorfieldsofactivitiestobeidentified;» the pilot project selection criteria for the LMS

introductiontobespecified;» the pilot project objectives, tasks, performance

requirements, and completion dates to bedetermined;

» proposalsconcerningthesystemformanagingtheintroductionoflifecycleapproachestobedeveloped;and

» proposalsonITsolutionstobedevelopedinordertosupportandensureprojectimplementation.The selection of pilot projects was based on

the principles of maximum readiness, actuality,potential economic efficiency, and replicationcapability (incorporation into the decision-makingand information interaction organisation system). Aspart of this selection, the technological and economicframeworks for the pilot projects were elaborated,includingtheproductlifecyclemanagement(PLM)andtheminimisationofthetotalcostofownership(TCO).

Theintroductionofthelifecycleprojectmanagementsystem is based on analysing the global experience,proceeding from the identified “gaps” in the existingorganisational and business models, as well as fromthe requirement for adjusting the existing rules andprocedures, building a system of motivation, definingtherequirementsofchangeinthesystemofinteractionsamongtheCompany’sdivisionsandfunctions,shapingcompetencies, and replicating the results of pilotprojects.

Operated equipment

New equipment

CONCEPT,PRE-DESIGN DESIGN TCORODUCTION OPERATION WITHDRAWAL FROM

OPERATION

PRINCIPLE: REDUCTION IN THE TOTAL COST OF OWNERSHIP (TCO) OF THE FACILITY’S EQUIPMENT (SUBSYSTEMS) AND THE FACILITY AS A WHOLE;TOOL: SYSTEM OF DECISION-MAKING FOR INCREASING THE COMPETITIVENESS OF FACILITIES (ICUF INCREASE, CONSTRUCTION COST REDUCTION, PROFITABILITY INCREASE, AND RELIABILITY AND SAFETY IMPROVEMENT);EFFECT: THE COMPANY’S VALUE INCREASES THANKS TO THE TCO REDUCTION AND THE GROWTH OF COMPETITIVENESS.

Cost reduction thanks to energy efficiency of new equipment Repair time reduction, ICUF increase thanks to reduction

Major results of the NFC and NPP lifecycle management activities in 2013

In the reporting year, the results of implementingmeasures as part of the following pilot projects wereselectedandapproved:

» PilotProject1-“ManagementoftheEquipmentTCO.Introduction of MCP 1753 and the Contract for ItsSupply,AssemblyandMaintenanceforKurskNPPII”;

» PilotProject2-“OptimisationoftheVVERFuelTCO”comprisingtwosubprojects:– “ValidationoftheOptimisedIsotopeComposition,

FuelCyclesandBurn-upofVVERNuclearFuel”;– “ValidationoftheVVERFuelREMIXApplication”;

and» PilotProject3-“SelectionofNPPSubsystemsfor

ImprovingtheCompetitivenessthroughtheUseoftheNPPLifecycleCostManagementTool”.Fortheintroductionofthenuclearindustrylifecycle

managementsystem,thedecisionwasmadetoestablishanNPPlifecycleinformationsupportcompetencycentrebasedononeoftheindustry’sorganisations.

NFC and NPP lifecycle management plans for 2014 and the mid-term:

» completion in2014ofPilotProject2“Optimisationof the VVER Fuel TCO”: assessment of optionaluses for theSNFprocessingproducts in thermal-

neutron nuclear generation, and the integrationof the nuclear fuel cost management model intoadynamicnuclearplantcostmodel

» finalisationofthedynamicnuclearplantcostmodel,which makes it possible to estimate the total costof NPP ownership, the efficiency parametersdepending on the operating cycle electricity rate,andthecostoffunding

» finalisation and scaling within the industry ofa standardised decision-making process basedon the estimated total cost of ownership and thespecific expenditures per unit of product in theoveralllifecycle

3.2.3.Managementofprocurement

To ensure the openness and informationtransparency of the procurement activities, theCompany’stechniquesinclude:

» unifiedrules, includingthoseforthecalculationofinitial (maximum) prices, the review of bids, andcalculationoftheextenttowhichtheprocurementstakeholdersareprovidedwithfinancialresources,aswellasmodelprocurementdocumentations(alldocumentsarepubliclyavailable);

» anincreaseintheshareofcompetitiveproceduresinanelectronicform;

» applicationofthere-auctionprocedureintenderingformalities;

VALUECHAINFORTHENUCLEARFUELLIFECYCLE

ADDED VALUE CHAIN

FEEDSTOCK MARKET TECHNOLOGY MARKET

FA

EUP

Geological prospecting/mining

Techsnab-export

TVEL (Enrichment)

TVEL(Fabrication)

UHF

PR

OD

UCT

S

SA

LE

S

NATURAL URANIUM

Conversion

Enrichment

Fabrication

Fuel processing

ARMZ

NFC FRONT END

SWU

Conversion

Resources/Uranium mining licences

Fabrication and components


» possibilityofalternativebids;» determinationoftheinitial(maximum)priceinthe

currentyearattheactualprioryear’spricelevel;» classificationofdraftcontracttypes;» classificationofbiddocumentformtypes;» classification of procurement documentation

types for order placement procedures anddocumentations;

» classification of procurement procedure protocoltypes;

» uniform selection and assessment criteria that isapplicabletoeachstakeholder;and

» conclusionoflong-termcontractswithafixedcostfortheentiretyofthecontractvalidityperiod.Thebasicdocumentthatregulatestheprocurement

activities of a nuclear organisation is the UnifiedIndustryProcurementStandard(ProcurementBylaw),which was approved by a decision of Rosatom’ssupervisoryboard.

3.3.Managementofhumancapital

The major goals of JSC Atomenergoprom in themanagementofhumancapitalare:

» to raise the Company’s attractiveness as theemployer, both to university graduates and toexperiencedspecialistsandexecutivestaff;

» implement,attheindustrylevel,uniformcorporatepolicies for efficiency management, carriermanagement,andexecutivestafftraining;

» trainthestaffreserveforexecutivepostsatdifferentlevels,and

» increasethepersonnel’sinvolvementlevel.The major processes aimed at increasing the

efficiency of nuclear personnel management ser-vices are: automation of staffing processes, de-

termination of the key performance indicators forpersonnel management service leaders, unificationof the personnel management service organisation-al structures, and control of the personnel manage-ment transaction processes within a shared servic-ing centre (SSC). These processes will contribute toa more than 20% increase in the personnel servicestaffperformanceby2015.

The average number of JSC Atomenergoprom’spersonnelin2013was100.7thousand.

The average age of the company’s industrial andproduction personnel is 42.8, and the average age ofexecutivestaffmembersis46.7.

Inthereportingyear,theshareofpersonnelunder35yearsofagewas30.7%.

Thenumberofpersonneldismissedinthereportingperiod was approximately 19.600, including 5.000dismissalsastheresultofoptimisationactivities.

Thepersonnel turnover,excluding thosedismissedas a result of the optimisation activities, was 19.42%in2013.

3.3.1.Remunerationsystemandsocialpolicy,

includingsocialsecurityofpersonnel

In 2013, the personnel expenditures totalled 99.6billion roubles, and the average expenditures peremployeeamountedto988.800roublesperyear.

Single standardised remuneration system

Thecorporate(industry)remunerationsystemcovers:» performance remuneration: strengthening the

dependencebetweenthematerialremunerationofpersonnel and their performance and consequentmeeting of key performance indicators. The KPIsfortheexecutivestaffmembersaredevelopedwithafocusonachievingthecompany’sstrategicgoalsand the KPIs set by Rosatom State Corporation’ssupervisory board. The strategic tasks, to whichorganisations and enterprises are assigned, are

Executivestaff Workers

Specialistandofficestaff

37.136.8%

14.914.8% 48.7

48.4%

99Industrial

andproductionworkers

1Non-industrialstaff

AVERAGENUMBEROFJSCATOMENERGOPROM’SPERSONNELIN2013,THOUSANDPERSONS

SHAREOFJSCATOMENERGOPROM’SINDUSTRIALANDPRODUCTIONWORKFORCEIN2013,%

100.7

transformedintoKPIchartsforparticularexecutivestaffmembersandaredisseminatedtothelevelofdepartments and individual employees. IndividualKPIcharts,basedonaunifiedcorporatestandard,have been developed for about 11 companyexecutives;and

» adecent levelof remuneration for labour: in2013,the monthly average wage per one employee atJSC Atomenergoprom was 61.760 roubles permonth. The average wage within the Company is55.6%higherthantheaveragewageacrossRussia(accordingtodatafromtheFederalStateStatisticsService, the average payable wage in December2013intheRussianFederationwas39.700roublespermonth).

Implementation of social policy

The Company’s social policy is aimed at achievingthefollowinggoals:

» increasingtheattractivenessoftheCompanyasanemployer;

» therecruitmentandretentionofyoungprofessionalsandhighlyskilledstaff;

» increasingpersonnelinvolvement;and» improvingtheefficiencyofexpenditures.

The social package for employed and retired staffmembers is based on the Single Industry Social Policy(SISP)guidelinesbasedonstandardisedcorporatesocialprogrammes(referredtoasCSPhereinafter).EachCSPis implementedwithregardtothestaffingobjectivesofeachorganisation,aswellastheirfinancialcapabilities.

Compensation and benefits are only provided aspart of CSPs to full-time personnel. The personnelremuneration and benefit standards suggest equalconditions for all staff members employed througha contract of employment with the industry’sorganisations,notwithstandingtheemploymenttermsandconditions.

Thetotalsumofsocialexpendituresforpersonnelamountedto4.2millionroublesin2013.

18Insurancepayments

78Payrollbudget

1Otherpersonnelexpenditures(includingtraining)

3Socialexpenditures

STRUCTUREOFJSCATOMENERGOPROM’SPERSONNELEXPENDITURESIN2013,%

MAJORCORPORATESOCIALPROGRAMMESOFJSCATOMENERGOPROM,MILLIONROUBLES

Corporate social programmes

2011 2012

2013 results

2013 Comments

Voluntaryhealthinsurance,millionroubles

626.2 531.4 545.4 Thevoluntaryhealthinsurancesystemcovers79.4thousandpersonnel(78.8%ofthepersonnelemployed)

Accidentandhealthinsurance,millionroubles

0.0 31.0 27.0 Accidentandhealthinsuranceprovidedfor64.4thousandpersonnel(64%ofthepersonnelemployed)

Healthresorttreatmentservicesforpersonnelandtheirchildren,including:

200.2 264.9 406.4 –

healthresortandrehabilitationtreatment,millionroubles

152.9 202.9 337.3 8.8thousandpersonnelprovidedwithhealthresorttreatmentandrehabilitationservices,including:–7.0thousandpersonnelprovidedwithhealthresortservicesand–1.8thousandpersonnelprovidedwithcorporateresthomeservices.

children’shealthresorttreatmentandrecreation,millionroubles

47.3 62.0 69.1 Healthtreatmentandhealth-improvingrestservicesprovidedto3.5thousandchildrenofpersonnel.

2011 2012 2013

41.4 37.8 41.9

AMOUNTOFSOCIALEXPENDITURESPEREMPLOYEEOFJSCATOMENERGOPROM,THOUSANDROUBLES


Corporate social programmes

2011 2012

2013 results

2013 Comments

Personnelhousing,billionroubles

92.3 126.5 190.8 Today,9.7thousandpersonnelarecoveredbytheprogramme,ofwhich2.481hadtheirhousingconditionsimprovedin2013,including50.3%ofyoungprofessionals(ascomparedto37.6%in2012).

Non-statepensionpayments,millionroubles

201.0 233.0 275.4 Atotalof43.8thousandpersons(43.5%ofemployedstaff)arecoveredbythenon-state pension payment programme, including 17.4 thousand who hadjoinedtheschemeonaco-fundingbasisbythebeginningof2014.

Supportofretirees,millionroubles

1,032.3 951.8 1,113.0 There are over 60 thousand pensioners registered within the industry’sorganisations.Healthresorttreatmentserviceswereprovidedto1.5thousandpensioners.0.6thousandpensionerswereprovidedwithcorporateresthomeservices.1.536pensioners were provided with one-time retirement payments. The averageamountofpaymentsperpensionerexceeded138.5thousandroubles.28.5 thousand pensioners are paid monthly state pension supplements. Themonthlypensionsupplementamountstoanaverageof1.2thousandroubles.48thousandpensionerswereprovidedwithwelfareassistance.

Personnelcatering,millionroubles

328.2 157.6 20.4 Over 3.2 thousand personnel are provided with meal allowances. A sharpdecreaseinexpenditureshasbeencausedbythewithdrawalofcateringservicesfromthecorporatebalance.

Organisationofsportandculturalevents,millionroubles

459.7 377.1 377.3 Everyyear,some1.3thousandpersonneltakepartincorporateandinternationalcompetitions. Over 11.3 thousand personnel (11.2% of those employed) areinvolvedinathleticprogrammesonaregularbasis.

Personnelrelief,millionroubles

518.4 321.5 846.1 In 2013, over 19.3 thousand personnel were provided with relief payments,a decrease of 6.7 thousand from the 2012 figure (due to the introduction oftransparentreliefcriteria).Atthesametime,theexpendituresincreasedbyafactorof2.6,whichwastheresultoftheminimumreliefsumhavingbeenintroducedandofanincreaseinthereliefpaymentamountaddedtothebasepaymentsinthecaseofchildbirth,thedeathofcloserelatives,deathofpersonnel,orseverediseases.

Other,millionroubles 643.8 760.5 416.4 Includesawiderangeofsocialbenefits(medicalservicesunderdirectcontracts,compensation of the health resort treatment package cost to the employee’srelatives,inducementsinconnectionwithawarding,etc.),aswellastheexpendituresformaintainingthesocialinfrastructurefacilitiesandtaxpayments.

Total: 4,102.1 3,755.3 4,218.2

In2013,toensuretheunityofthenuclearindustrymanagement, the Unified Industry ProceduralGuidelines were developed and put into operation fortheexpertassessmentofdraftsoftheunioncontracts.Unioncontractscover81.4%ofthoseemployedwithinnuclearorganisations.

TheminimumtermfornotifyingJSCAtomenergo-prom’s personnel on any major changes to theCompany’s activities is defined by Article 74 of theRussianFederationLabourCode.Accordingtothelaw,the notification term is two months prior to the datethatthegivenchangetakesplace.Nootherpersonnelnotification term is defined in the nuclear power,industry,andsciencebranchagreementfor2012–2014;however, paragraph 1.3 stipulates that any union andlabour contract terms and conditions that make thesituationworseforpersonnel,ascomparedtoRussianlawandtheindustryagreement,areinvalid.

3.3.2.Improvementofpersonnelmanagement

efficiency

ImplementationofthekeyKPIsinthefieldofnuclearpersonnelmanagementfor2013included:

» an increase in the share of the appointments ofpeoplefromthestaffreservefrom20.2%to28.5%;

» introduction of a standard for the formation oforganisational structures within the industry’sorganisations;

» simplificationoftheorganisationalstructures:- areductioninthemanagementlevel,depending

on theorganisation’sactivityandstaffnumber,fromseventofourmanagementlevels;and

- an increase in the efficiency of administrativework (the span of control extended from 5.4subordinatestaffper1leaderto7.75);

» establishment of functional verticals andimprovement in the efficiency of interactionsbetweenthemanagementlevelswithintheindustry;

» switchover of 9 enterprises with a workforce of23 thousand to a target IT system (SAP HR). Theoverall workforce transferred to the industry ITsystem is over 50 thousand. The processes beingcomputerisedinclude:personnelandtime-keepingrecords, payroll preparation, organisationalmanagement,andperformancemanagement(KPIsandcompetencyassessment);

» transferof18enterpriseswithatotalworkforceof23.5thousandtothepersonnelmanagementSSCinchargeoftransactionstaffingprocesses;

» successful optimisation of the personnelmanagementcostsbyasumof200millionroublesin2013,thankstotheautomationandthetransfertotheSSC;

» formation of individual KPIs for 19 thousandexecutivestaffin2013;

» trainingofapproximately3.000employeesaspartof standard managerial competency developmentprogrammesin2013(ascomparedto2.000in2012);

and» areductionintheoperatingcostsforthepersonnel

management function by 200 million roubles in2013thankstotheautomation,standardisationandcentralisationofpersonnelmanagementprocessesand the transfer of transaction processes to theSSC.

Personnel incentive system. Carrier management

Formation and development of the executive staff reserve

The formation of the executive staff reserve isoneofthetoppriorities inthenuclear industry’sstaffdevelopmentsystem.

Thestaffreserveprovidesforthecontinuityoftheindustryvaluesandexpertise,andtheevolutionofthemanagementsystem,whilealsocontributingtogreaterstaffloyaltywithinJSCAtomenergoprom.

Asoftheendof2013,thetotalpooloftheexecutivestaffreservewas369(0.37%oftheaverageexecutive,specialist,andofficestaffamount).

Integrated executive staff reserve developmentprogrammesareimplementedbasedontheCorporateAcademy of Rosatom, an autonomous nonprofitorganisation. In 2013, 15.7% of those involved in thestaffreserveprogrammesreceivednewappointments.

Non-financial incentives

The unified industry award policy is one of themost important components in the non-financialincentive system. In 2013, 30 staff members ofJSC Atomenergoprom had state and governmentawards conferred upon them for their respectivecontributions to the evolution of the nuclear industry,nuclearandradiationsafety improvements, increasednuclearelectricitygeneration,andglobaltechnologicalleadership.

In 2013, 5.157 Russian nuclear industry staffmembers were awarded for professional excellence,greatindividualcontributionstotheachievementofthenuclear industry’s top-priority objectives, and a longhistoryofdedicatedservice.

3.3.3.Personneltraining

Training and advanced training

The personnel competencies within JSC Atom-energopromanditsorganisationsaredevelopedaspartofintegratedmanagerialstaffreservedevelopmentandmultiple-levelexecutivetrainingprogrammes,functional

training,andadvancedtrainingprogrammes;mentoringschemes;andarangeofindustryworkshopsandtrainingcoursesconductedbyoutsidetrainingsuppliers.

The training and development programmes havebeen developed for different management levels andactivitiescarriedoutbynuclearindustrypersonnel.

Thepersonnelreceivetraininginavarietyofformsthat are based on efficient development techniques,including classroom training, participation in projects,on-the-job training, self-training,mentoring, coaching,andotherstrategies.

Classroom training is provided by the industry’seducational establishments, such as the CorporateAcademyofRosatom,theCentralInstituteforAdvancedTraining,andtheNationalResearchNuclearUniversityMEPhI(MoscowEngineeringPhysicsInstitute),aswellasbyleadingconsultingandtrainingcompaniesinRussia.In2013,26.410 industrypersonnel received trainingattheindustry’seducationalestablishments.

The average level of expenditures for training oneemployee in the nuclear industry was 3.260 roublesin 2013. On average, an employee within the industryreceives29to64hoursoftrainingperyear,dependingontheindividual’smanagementlevel.

Mentoring is a special component of the nuclearstaffdevelopmentsystem.Itisusedinthestudentandprobationercareerguidanceprocess,atthenewcomeradaptationstage,inexecutivestaffappointmentswithina higher management level, and in the developmentof potential successors. The total number of mentorswithintheindustrywasover200in2013.

Industry development programmes suggestintermodularsupportandtraining,includingparticipation

NUMBEROFTRAININGHOURSPEREMPLOYEEWITHABREAKDOWNBYMANAGEMENTLEVELS,

2013

Top

Senior

Middle

First-line

Specialiststaff

36

64

50

50

29

NUMBEROFEXECUTIVESTAFFRESERVE

Levels of executive staff reserve Development programme Number of people involved as of the end of 2013

Senior PatrimonyofRosatom 65

Middle CapitalofRosatom 139

First-line TalentsofRosatom 165

Total 369


in cross-divisional projects and self-training. In 2013,in a partnership with Russian publishers, a corporatee-library, known as “Rosatom Leader Library”, wasformed; it contains over 100 e-books and businesseditions.SinceSeptember2013,articlesonmanagementissues have been published for industry personnel inpartnershipwithaleadingbusinessmagazine.

Interaction with universities

In the reporting year, an educational association,theConsortiumofBaseUniversitiesforRosatomStateCorporation, continued its activities. It unites 14 job-oriented higher vocational educational establishmentstraining personnel for the nuclear industry. The baseuniversitiescoverover49%(42%in2012)oftheindustry’sdemand for young professionals. Together with theCorporation, the association’s member universitiesconsideredtheproblemsinvolvedintheindustryorder

placementforthetrainingofnuclearspecialiststaff.The industry’s innovative development programme

suggestsamajorscalingofjointresearchactivitieswiththe job-oriented universities. By 2020, the share of theR&Dorderfundingforuniversitiesisexpectedtoamountto10%ofRosatom’stotalR&Dfunding,whichisequivalentto4.3billionroubles.Since2009,apositivegrowthtrendhasbeenobservedinthedynamicsofRosatom’sportfolioofR&Dordersforjob-orienteduniversities.

Staffing of organisations with young professionals

The employment of university graduates withinthe nuclear industry’s organisations was monitoredin 2013. In 2013, 907 people were employed withJSC Atomenergoprom’s organisations (795 in 2012).A forecast for the period until 2012 was also made intermsofthedemandoforganisationsfortherecruitment

ofspecialiststaffwithhigherandsecondaryvocationaldegrees. A tool was built to model the developmentdynamicsoftheyoungprofessionallabourmarket.Themostsought-afterprofessionsinwhichspecialistsaretrainedwere listed.Offeringon-the-jobtrainingwithintheorganisationsofJSCAtomenergopromtostudentsofjob-orienteduniversitieswascontinuedinthereportingyear.In2013,3.217universitystudentsreceivedon-the-jobtraining(3.180in2012).ProbationtrainingwithintheenterprisesofJSCAtomenergopromwasalsoreceivedby 152 postgraduate students and university facultymembers(87in2012).

Given the existing demand for professional trainingwithin the organisations of JSC Atomenergoprom,459 people enrolled in 76 universities in 2013 (443 in2012).The totalnumberofstudentswhowerereceivinguniversitytrainingin2013aspartoftargetordersfromtheorganisationsofJSCAtomenergopromamounted to761(779in2012).Therewere340peoplewhoreceivedtrainingthatwaspaid forbyvariousorganisations (214 in2012).Theamountofin-housefundsspentbyorganisationsforthetargetuniversitytrainingofstudentsamountedto31.86millionroublesin2013(23.05millionroublesin2012).

TheorganisationsofJSCAtomenergopromactivelyuse the opportunities offered by the extra vocationaluniversity training system. In 2013, 3.302 employeesof JSC Atomenergoprom’s enterprises underwentprofessional retraining or advanced training at auniversitylevel(2.110in2012)andapproximately72,98million roubles were spent for the training services(103,16millionroublesin2012).

Therecruitmentandretentionofgiftedyoungpeoplewithin thenuclear industry, aswell as the improvementandpromotionofjob-orientededucation,aresignificantlyaided by initiatives on annual tenders for awarding 150scholarships (each one of 5.000 roubles per month) touniversity students trained in the professions that aremostindemandwithinthenuclearindustry,aswellasforawarding100prizes(of100.000roubleseach)totalentedandpromisingyoungscientistsemployedwithinnuclearorganisations.

In2013,aforecastwasmaderegardingtheevolutionoftheyoungprofessionalmarketwithintheindustryfor

EXPENDITURESFORR&DWITHUNIVERSITIES,MILLIONROUBLES

DYNAMICSOFCHANGESINTHENUMBEROFFOREIGNSTUDENTSRECEIVINGNUCLEARTRAINING

INTHERUSSIANFEDERATION(THROUGHROSATOMSTATECORPORATION/

JSCATOMENERGOPROM),PEOPLE

2009 2010 2011 2012 2013 2014 ... 2020200

46 307 472 702

550 739 810 877 900 4,300

2010 2011 2012 2013 2014168


theperioduntil2015,andatoolwasbuiltformodellingthedevelopmentaldynamicsoftheyoungprofessionallabourmarket.Thelevelofthespecialiststaffemploymentintheindustry-specificjobareasisexpectedtoincreaseto75%by2020(ascomparedto35%in2011).

A study on the demand for the training of youngspecialiststaffmembersinthemostsought-after(target)professions,under industryevolutionconditions,showsfourfoldgrowthinthedemandforpersonneltraininginthe period of 2010–2015, including 2.500 highly skilledstafftobetrainedduringthatfive-yearspanfortheR&DsectorofRosatomandJSCAtomenergoprom.

International cooperation in education

The system of exporting Russian nucleareducation to potentially interesting markets forJSCAtomenergopromcontinuestobeformed.Russianuniversitiesprovidenucleartrainingtoforeignstudents,such as at the National Research Nuclear UniversityMEPhI, as well as its branch department in Obninsk(387 persons), and its partner universities. In 2013,472 Vietnamese, Turkish, Mongolian, and JordanianstudentswerestudyingatRussianuniversities.

3.4.Managementofsocialandrelationshipcapitalcapital

Management of social and relationship capitalsuggeststheestablishmentofstructuralinteractionswithstakeholders,raisingthepersonnelinvolvement

level, contributing to shaping public acceptance ofnuclear technology evolution, brand management,and the development of JSC Atomenergoprom’soperationalareas.

3.4.1.Interactionswithstakeholders

3.4.1.1.Approachestointeractionswithstakeholders

Due to the scale and diverse nature of itsactivities,JSCAtomenergopromhasabroadrangeofstakeholdersbothinsideandoutsideRussia.Focusedrelations with stakeholders are primarily aimedat achieving the company’s strategic goals and atcontributingtothepublicacceptanceofnuclearpowerevolution.

The philosophy of interactions is based onrespecting and taking into account the stakeholderinterests, open prolific cooperation, timely and fulldisclosure of information concerning the Company’sactivities,thedesiretoensureparticularbenefitsforallstakeholders,andthefulfilmentofone’sobligations.

Duetothewidevarietyofmajoractivities(uraniummining, NPP construction, electricity generation,fabrication of fuel, power engineering, and others),as well as of auxiliary activities (internationallegal cooperation, legislative activities, etc.),each activity has its own stakeholders; therefore,JSC Atomenergoprom establishes systemic andplanned interactions with them. Meanwhile, someof JSC Atomenergoprom’s activities are aimed atcollaborating with all stakeholders and the publicatlarge.

International organizationspromoting standards

Training organisations Expert

community (Russia)

International expert community

Government bodies of other countries

Professional associations

Scientific organisations

Local self-government bodies

Mass media

Local communitiesPublic

organisations

Rating agenciesand market analysts

Public environmentalorganisations

Top management of subsidiaries and associates

Top management of the Corporation

Corporation’s personnel, including subsidiaries and associates

Trade union organisations Government bodies of the Federation’s subject territories

Consumers of products, goods, and services on the Russian market

Suppliers of equipment

Business partnersin the global market

Consumers of products, goods, and services in global market

State supervising authorities

State as the only founder and investor

State as the regulator of activities

9,18,17,16,15,14,13,12,11,19,08,07,05,0 6,04,03,02,01,0 2,01,00,0

2,0

1,9

1,8

1,7

1,6

1,5

1,4

1,3

1,2

1,1

0,9

0,8

0,7

0,6

0,5

0,4

0,3

0,2

0,1

1,0

STAKEHOLDERRANKINGMATRIX

(Х) Impacts of the Corporation’s activities on stakeholder

(Y

) S

tak

eh

old

er

imp

acts

on

th

e C

orp

ora

tio

n’s

act

ivit

ies

СОЦИОЛОГИЧЕСКИЕИССЛЕДОВАНИЯОБЩЕСТВЕН-НОГОМНЕНИЯ

ОБЩЕСТВЕННОЕМНЕНИЕОРАЗВИТИИАТОМНОЙЭНЕРГЕТИКИВРОССИИ

INTERACTIONSWITHSTAKEHOLDERENGAGEMENT

1 – 15 B C E F G

1 2 4 6 7 10 B C N

2 6 10 14 B C E F

2 14 C E F G K

1 2 6 7 10 A K

3 5 8 12 15 D K

5 7 10 K L

3 5 6 7 8 9 11 K

5 6 7 8 10 12 K MP Q

6 13 15 F D K O

2 10 14 C E G K

6 10 13 15 F D I E

14 C E F G H K

3 13 15 D J

3 5 8 10 K

5 10 12 K

1 2 4 6 10 11 14

3 K O

H

O

O

O

H O

G

Government bodies of the Russian Federation

State supervising authorities

Regional government bodies

Local self-government bodies in the operating areas

International organisations, including in the nuclear sector

Rosatom’s organisations

Producers and suppliers of equipment and services

Consumers of technologies, products, and services

Business partners

Professional associations

Public, including environmental organisations

Local communities in the operating areas

Training organisations

Financial institutions

Rating agencies, market analysts, and experts

Citizens of the Russian Federation

Scientific organisations

Employees of the Corporation and its organisations, as well as organisations representing their services

Stakeholder interests

Non-proliferationofnuclearmaterialsandtechnologies

Faircompetitionandresponsiblemarketbehaviour

Decentremunerationforpersonnelandprofessionalgrowthofemployees.Safelabourconditions

Nuclear,radiation,andenvironmentalsafety Competitivenessinworldmarkets Improvementoflivingstandardsinthe

operatingareas

Upgradingofnuclearindustry Improvementinthequalityofproductsandservices

DevelopmentofAtomenergoprom’sstaffingpotential

EfficiencyofbudgetspendingTransparencyofAtomenergoprom’sactivities,includingtransparencyofprocurement

EconomicefficiencyofRosatom’sorganisations Reliableelectricitysupplies

AdherencetointernationalandRussianlaw

Introductionofinternationalregulationsandstandards

Types of interactions with stakeholders

Cooperationwithdesignatedinternationalorganisations,participationininternationalprogrammesandprojects

Charitableactivities Programmesofcooperationwithothercompanies

Participationinlegislativeactivities Publicsurveys,usersatisfactionstudiesProgrammesofcooperationwithgovernmentsupervisingauthoritiesandlawenforcementbodies

PublichearingsandpublicenvironmentalexpertreviewsforNPPconstructionprojects

Hotlines Publicmanagementandsupervisingbodies

Personneltrainingandadvancedtrainingprogrammes

Programmesofcooperationwithjob-orienteduniversities Awarenessandcommunication

Socialprogrammesandprojects Dialogues,presentations,forums,andconferences Publicreporting

Participationinthedevelopmentofoperatingareas Publicandcompetitivetenderprocedures


3.4.1.2.Communicationsandawareness

In 2013, communication and awareness activitieswerecarriedoutwithrespecttotwoobjectives:

» improving the public acceptance of nuclear powerevolutioninRussiaandothercountries;and

» explainingthestrategyoftheCompanyasaglobaltechnologicalleaderthatoffersinnovativesolutionsnot only in nuclear power, but also in nuclearmedicine,materialtechnology,spaceexplorations,energysavings,andsafetyimprovement.

Direct external communications

Public Council

The Public Council of Rosatom State Corporationwas formed in 2006 for the stated purpose of havingRussianpublicandprofessionalassociations,scientificorganisations, and local self-government bodiesinvolvedinthedevelopmentofnucleardecision-makingguidelines.

In 2013, the Public Council continued to activelycarry out numerous activities concerned with thesafeusesofatomicenergy.Thefollowingeventswerestagedinthereportingyear

» the 8th International Public Forum Dialogue,entitled Atomic Energy, Society, Safety, Moscow(200 delegates, 9 countries, and 22 publicorganisations);

» the 6th Regional Public Forum Dialogue, entitledNuclearGeneration,Society,Safety,St.Petersburg,(150delegatesand15publicorganisations);

» three technical tours, including members of thepublic,toRussiannuclearsites;

» fivescientificandpracticalconferencesandroundtables for education and health workers, as wellasforthepublicinnuclearinstallationdeploymentlocalities;

» two research paper contests involving scientistsand university/school students (Energy of Future

Generations, International Contest of ResearchPapersontheEnvironmentalProblemsofNuclearPower);

» an open public competition among nonprofitorganisations related to the development andimplementation of socially significant projects fornuclear installationdeployment localities (in2013,over193projectsfrom29regionsweresubmittedforthecompetition,ofwhich127wereacceptedbythePublicCouncil);and

» thepublicationofsixreferenceandpopular-sciencebooksandbookletsaspartoftheproject,entitledLibrary of the Public Council, including IAEA’sbooklet,CommunicationwithPublicinaNuclearorRadiologicalEmergency.

Atomic energy information centres

Since 2008, a project has been under way withinthe industry to set up atomic energy informationcentres(AEIC)intheoperatingareasoftheCompany’sorganisations(www.myatom.ru).

The primary tasks of the centres are thedissemination of basic knowledge about the nuclearindustry,publicawarenessactivities,andthepromotionof science, innovative technologies, and technicaleducationtosecondaryschoolstudents.

The first of these centres was opened in Tomsk.Today,thisinformationnetworkinRussiaincorporates17informationcentres.

InDecember2012, the first foreigncentresbeganoperations in Hanoi, Vietnam and in Mersin, Turkey.In 2013, an information centre was opened in Dhaka,Bangladesh.

Over the course of five years, the centres havereceivedoveronemillionvisitors,includingmorethan344.000in2013.Visitorstothecentresareabletowatchmultimediaprogrammesonnuclearpower,astronomy,and regional geography, and can also take part inartistic,educational,andawarenessprojects.

TheysaythatRussiawillhaveexhausteditsoilandgasresourcesin20years.Whatdoyouthinkmight

substitutetheseasenergysources?(%ofrespondents)

Howdoyouthinknuclearpowershouldbetreated:developedactively,maintainedatthesamelevel,phased

out,orabandonedabsolutely?(%ofrespondents)

coal hydraulicresources

atomicenergy

other hardtosay developedactively

maintainedatthesame

level

phasedout abandonedabsolutely

hardtosay

9.1

21.3

39.9

6

23.8

30.8

39.5

14.5

4.810.4

ThesurveywasconductedbytheLevadaCentre,aRussiannon-governmentalpublicopinionpollagency;itisbasedonarepresentativeselectionofRussia’spopulation(1.601peopleaged18yearsorolder)andwasconductedinSeptember2013.

PUBLICOPINIONSURVEYSPUBLICOPINIONONTHEEVOLUTIONOFNUCLEARPOWERINRUSSIA

AEIC-based nuclear education projects

In 2013, a number of AEIC-based traditionaleducationalprojectsweresuccessfullyimplemented.Inthereportingyear,thefederalawarenessprojects,entitled Energy of Science and Science and Sports:Full Contact, were implemented for the first timeby the AEICs. As part of Energy of Science, over700 residents of Chelyabinsk, Vladimir, Smolensk,Ulyanovsk, Tomsk, and Rostov-on-Don could takepart in the events conducted by Russian sciencepromoters.

Overfivethousandschoolanduniversitystudentstook part in the AEIC-based federal awarenessproject, Science and Sports: Full Contact, whichwas sponsored by the Russian sports ministry andJSCAtomenergoprom.Theparticipantsintheprojectattended the AEIC-based Olympic classes, whichinvolved both scientists and athletes, and met withthelegendaryice-hockeyplayerVladislavTretyak,aswell as renowned athletes Olesya Vladykina, UlyanaDonskova,andGlebGalperin.

In 2013, as is tradition, the AEICs held the 8thAll-Russian Research Paper and Abstract Contestfor School and University Students, entitled NuclearScienceandTechnology.

Inthereportingyear,itwasthefirsttimethattheinformation centres acted as partners for the All-RussianFestivalofScience. InSt.Petersburg’sAEICalone, the festival’s events (public lectures, cinemaclubs, scientific shows, and artistic contests) wereattendedbyover2.500schoolstudents.

Forsazh-2013 forum

The 3rd Young Generation Innovative Forum,Forsazh-2013,washeld in theKalugaRegion from30June to 6 July 2013. The total number of participantsandvisitorsexceeded700.Youngemployeesofnuclearenterprises were in high attendance at the forum.The programme was divided into the Innovative,Global, Energopolis, and Information sectors. For aweek, young professionals of JSC Atomenergoprom’sorganisations and partner companies attendednumerous master classes and business games, took

Murmansk

Kaliningrad

St. Petersburg

SmolenskMoscow

VladimirNizhny Novgorod

YekaterinburgUlyanovskVoronezh

Rostov-on-Don SaratovChelyabinsk

Novosibirsk

Tomsk Krasnoyarsk

- acting- preparing to open

Petropavlovsk-Kamchatskiy

Hanoi (Vietnam)

Dhaka (Bangladesh)

Mersin (Turkey)

Minsk (Belorussia)

ATOMICENERGYINFORMATIONCENTRES

DYNAMICSOFTHEAEICOPENING

1 3 8 15 19 212008 2009 2010 2011 2012 2013


partincasestudies,anddefendedprojectsbeforetheleaders and representatives of leading Russian andforeign companies, competent experts, analysts, andscientists.

Innovations Train

Theyear2013saw thecontinuationof InnovationsTrain, an information and enlightenment projectimplementedjointlywithJSC“RussianRailways”.ThisisauniquemobileexhibitionandlecturecomplexthatreceivesvisitorsacrossRussiawhile travellingon thecountry’s railways. Of particular interest were NPPsafety improvement designs developed by Russianscientistsandengineers,includingamelttrap,reactorcontrolandprotectionrods,andthecontainmentarea.The operation of these strategies was demonstratedwith the aid of interactive teaching modules. Afterthe tourof theexhibition,everyvisitorcouldmeasurehis/her radioactivity using a multipurpose radiationdetector.

In 2013, the Innovations Train covered a total ofnearly72.000kilometres,visiting123townsandcities;the exposition was seen or visited by over 148.000people.

Forums and exhibitions

В2013годуОАО«АтомэIn2013,JSCAtomenergo-prom took an active part in awareness and displayactivitiesbothinsideandoutsideRussia.

A very special event was the 5th InternationalExhibition ATOMEXPO-2013, which was held 26–28June2013 inSt.Petersburg, in tandemwith the IAEAMinisterial Conference. This defined ATOMEXPO’smajor topic Nuclear Power in the 21st Century:ResponsiblePartnershipforSustainableDevelopment.Theforumwasattendedbydelegationsof42countriesandrepresentativesfrom153corporateexhibitors.Theforum’sbusinessprogrammeattracted791delegatesfrom 275 organisations. A number of internationalagreements were signed as part of the forum todemonstrate and prove the efficiency of internationalcooperation.

The major topic of the 7th International ForumAtomExpo-2013 (30–31 October 2013, Moscow) wasNuclearPowerasaZero-DamageStrategy,whichdefinedthe agenda of the business programme discussions.The forum was attended by about 1.000 representativesfrom 18 countries. As part of the business programme,reportsweredeliveredby296Russianandforeignleadersand experts. Accomplishments by 31 companies weredisplayedaspartoftheexhibitionandtheforum’sbusinessprogrammewasalsocomprisedof10breakoutsessions.

The international forum of nuclear suppliers,ATOMEX-2013, (2–4 December 2013, Moscow) wasmarked by a highly topical business programme,includingthankstosmallandmediumbusinessesbeinginvolvedintheprocurementactivities,andthankstotheimprovementintheefficiencyofprocurement;extensionof the number of suppliers, including messages ofthanks to the small and medium businesses involvedintheprocurementactivities;andtheimprovementin

the efficiency of procurement. A great deal of interestwas shown by the delegates in the customer-supplierbusiness meetings (in a B2B format), which had beenorganised for the first time as part of the forum. Theforumwasattendedbyover630representativesfrom322companiesthroughoutRussia,Belarus,Germany,Spain,Ukraine,Finland,France,CzechRepublic,andJapan.

Internal communications

Involvement level studies

Aseriesofinvolvementstudieshavebeenconductedwithinthenuclearindustryforthreeyears(2011–2013).Since2011,thenumberoftheparticipatingorganisationshasgrown from45 to57, thanks toagreater interestintheindustry’senterprisesanddivisionsinthegiventool(including32enterprisesofJSCAtomenergoprom).Theseenterpriseshaveaworkforceof200.000people,

ofwhichover42.000takepartinthesurveyseachyear.The following activities were undertaken during

thethree-yearperiod:

» eight awareness days were conducted at216 nuclear organisations (of which 67 areJSC Atomenergoprom’s) with a total of 90.000 to187.000peoplecovered;

» a public feedback mechanism was establishedandhasbeenregularlyusedtohandlepersonnel’squestionstoindustryleadersandprovideanswerstothesequestions;

» over 300 articles were published in the industry’speriodicals, including answers to the personnel’squestionsconcerningsocialpackage,wage,career,andotherissues;

» over 2.400 events were conducted for improvingpersonnelinvolvementwithinnuclearorganisations,

2011 2012 2013

LEVELOFTHENUCLEARPERSONNELINVOLVEMENTIN2011–2013,SHOWNINDYNAMICS,%

60 62 67

including the installation of information terminals,thetrainingofproductionleaders,wageindexation,corporate parties, the development of mentoringprogrammes,on-the-jobtraining,repairs,children’scamps (enterprises of JSCAtomenergomash),achildren’sfestival inSnezhinsk,andmanymore;and

» regularvisitsmadebytheindustry’stopleaderstokeysites.Thekeyeventsandprojectsin2013were:

» visitsmadebythenuclearindustry’sleaderstotheindustry’skeysites(over170visitsto50sites);and

» auditing of the labour payment system (UnifiedStandardised Remuneration System) at some ofJSCAtomenergoprom’senterprises.

Theprimelong-termobjectiveoftheinvolvementproject within the nuclear industry is to achieve thesamepersonnelinvolvementleveloftheworldleaders

in technological industries (70% or higher) withinthreetofiveyears.

Industry personnel recognition programme

Anindustrynominationprogramme,Rosatom’sManof theYear,wasdevelopedand introduced in2013 forthepurposeofrecognisingthepersonnelservices.Thenominationlistconsistsof53nominations,including35divisionalnominations,13corporate-levelnominations,and5DirectorGeneral’sspecialnominations.

For three weeks, during which the new contestwas announced within the industry, 768 personnelapplications for participation in the contest werereceived,ofwhich378werefordivisionalnominations,243forcorporate-levelnominationsand147forspecialnominations. JSC Concern Rosenergoatom accountedfor the largest number of the applications for special

nominations(47).Theapplicantswereagedbetween23(theRisingStarnomination)and83years(theMentoroftheYearnomination).

The course of the contest was highlighted by allcorporate media. In 2013, there were 177 shortlistedparticipantswhorepresented65enterprises(including29 JSC Atomenergoprom’s organisations). The awardceremony, which involved the participation of theindustry’sleaders,washeldon27FebruaryinMoscow.Theceremony’s leveloforganisationandformatwerehighlypraisedbytheparticipantsingeneral,aswellasbythecontestwinnersandtheindustryleaders.

Public communications, mass media, and Internet

What? Where? When? TV game show

One of the most important projects in the field ofpublic communications in 2013 was the cooperationwithWhat?Where?When?,aRussiantelevisiongameshow. The placement of image-building clips aboutthe Corporation of Knowledge in the most intellectualTVgameofferedbytheRussianTVnetworkhasbeena successful example of accessing and dealing withthe target audience. Furthermore, a number of theCompany’s employees joined the Rosatom Team forparticipation in the game as the result of internalselection. The young team of nuclear specialistsbecamethediscoveryof theseasonand,at thesametime,theembodimentofthenuclearindustry’sstaffingand intellectual potential in the eyes of Russian TVviewers. By qualifying for the game’s final stage, theRosatomTeampositionedtheRussiannuclearindustryas an activity and business sphere based on humanknowledge,innovation,andhightechnologies.

Horizons of Atom

In collaboration with Rossiya television channel,JSCAtomenergopromisaproducerofaTVprogramme,HorizonsofAtom,whichhighlightsvariousaspectsofthe nuclear industry’s activities and innovative designdevelopment. The purpose of the programme is topublicisetheindustry’splansandactivities,provideforthe psychological perception by the public at large ofthe safety of the peaceful uses of atomic energy, andcontributetotheinflowofyoungpeopleintotheindustry.

The programme is broadcast on the Rossiya-24channel on a regular basis. Altogether, there were 23programme editions broadcast in 2013. In December2013, a documentary, entitled Encyclopedia of Atom.Volume11.DealoftheCentury:MegatonstoMegawatts,wasalsoshownontelevision.

Industry press

The publication of Strana Rosatom (“RosatomLand”), the industry newspaper with a circulation of55.000 copies, was continued in 2013. Annually, aspartoftheinvolvement levelstudies,thenewspaper’scurrent confidence index, as a source of informationabout the activities of the company and the industryas thewhole, ismeasured. In2013,StranaRosatom’s


confidenceindexgrewby14%toreach64%.Vestnik Atomproma (“Atomprom Herald”), the

industry journal with a circulation of 3.600 copies,continued to be published in the reporting year. Thejournalisprimarilyaperiodicalfornuclearspecialists.Itpublishescontentonthemosturgentproblemsoftheindustry’sevolution.

Atomnyekspert(“NuclearExpert”)isasupplementto the scientific edition Atomnaya Energiya (“AtomicEnergy”)thathasbeenissuedsince2011.Thisjournalis an information and analytical project for nuclearprofessionalstaffandiscirculatedonatargetedbasis.Itscurrentcirculationis1.500copies.In2013,tenissueswerepublished.

There are 27 additional industry periodicals, themajority of which are such newspapers as Novoyevremya (“New Time”) (publisher: Siberian ChemicalCombine, Seversk; circulation: 15.700 copies) andImpuls (“Pulse”) (publisher: Electrochemical Plant,Zelenogorsk;circulation:10.000copies),whichhavethestatusofmunicipaleditions.

A Ring of Websites project

In 2013, JSC Atomenergoprom continued toconsistentlyextenditspresenceintheInternetnetworkto keep the public at large informed on its activitiesandtheeventstakingplace inthe industry.Workwascontinued to upgrade the existing websites of theCompany’sorganisations.

Aspartof theprojectARingofRosatomWebsites,which was launched in 2009 to invigorate the webcoverage of JSC Atomenergoprom’s activities,informationwasalsoextensivelypostedonthewebsitesof the Company’s major subsidiary enterprises. Inparticular, JSC Atomenergoprom’s website postedinvestor-relatedinformationrequiredtobedisclosedbyapplicableRussianlaw.In2013,intermsofinformationdisclosure, the Company’s major divisions were highlyactive, specifically the Machine Building Division(JSCAtomenergomash)andtheFuelDivision(JSCTVEL).Thesecorporatewebsitesandportalsarebasedontheindustry-genericITPlatform(IBMWebsphere)andhavean identical design, which contributes to the increasedrecognisabilityoftheCompany’scorporatedesign.

3.4.2.Activitiesinoperatingareas

ManagementofsocialandeconomiccapitalintheCompany’soperatingareasincludesthemanagementof social and socio-economic programmes in theoperating areas, including investments in socialinfrastructuresandtheestablishmentofconstructiveinteractionswithstakeholders.

TheeconomicimpactofJSCAtomenergopromonthedevelopmentoftheoperatingareasisintegrated.TheCompanycontributessignificantlytoensuringtheenergy security of the whole range of regions, andtakes an active part in the creation and fair divisionof value. JSC Atomenergoprom is a major taxpayerintheoperatingareas,makingtaxpaymentsintothebudgetsatalllevels.ThegreateconomiceffectsfromtheCompany’soperationsshowthemselvesinalargenumberofqualifiedjobsbeingcreatedinthenuclearindustryandintheadjacentsectors,whileprovidingnotonly foragreatdealofemploymentcapabilities,but also for decent labour conditions and paymentlevel.

CREATIONANDDIVISIONOFVALUE,MILLIONROUBLES

Description 2013 2012

Crated value 437,435 399,601

incomes(salesproceeds,aswellasincomefromfinancialinvestmentsandsaleofassets)

437,435 399,601

Divided value 302,676 291,545

operating costs (payments to suppliers and contractors, materialprocurementcosts)

(162,220) (170,471)

wagesandotherpaymentsandallowancestopersonnel (83,400) (77,154)

paymentstocapitalsuppliers (17,283) (9,082)

grosstaxpayments(lesspersonalincometaxandVAT) (33,478) (28,805)

investmentsincommunities,includingdonations (6,295) (6,033)

Undivided value 134,759 108,056

3.4.2.1.Contributiontocreationanddivisionofvalue

The overall economic performance ofJSC Atomenergoprom is disclosed in the tablegiving data on the creation of value and its divisionamong the stakeholders. The created value is dividedamong the suppliers and the contractors (as part ofoperating costs), the capital suppliers (as interestpaymentstocreditors),thepersonneloftheCompanyand its organisations (labour payments and socialexpenditures),thestate(intheformoftaxpayments),local communities, and the regional and municipalauthorities(associalinvestments,charityexpenditures,andtaxpayments).ApartofthevaluecreatedisretainedbytheCompanyintheformofundividedvalue,includingthefundsearmarkedforbusinessdevelopment.

3.4.2.2.Creationofnewjobsandcontracting

Traditionally, for thenuclear industry, theactivitiesof JSC Atomenergoprom and its organisations havebeengovernedbyresponsiblebusinessprinciples.TheCompanytakesintoaccountthesignificanceofbusinessresponsibility principles and gives them precedence,whilehaving thisas itsprimeobjective: thesocialandeconomicdevelopmentofRussia,alongwithitsregionsandcities.Anumberofindustry-widesocialprogrammeswere embarked upon and have been consistentlyimplementedbytheCompany.

3.4.2.3.Implementationofsocialandcharityprogrammesinoperatingareas

Traditionally, for the nuclear industry, the activities ofJSC Atomenergoprom and its organisations have beengovernedbyresponsiblebusinessprinciples.TheCompanytakesintoaccountthesignificanceofbusinessresponsibilityprinciplesandgivesthemprecedence,whilehavingthisasitsprimeobjective: thesocialandeconomicdevelopmentof Russia, along with its regions and cities. A number ofindustry-wide social programmes were embarked uponandhavebeenconsistentlyimplementedbytheCompany.

Charity activities

The Concept of Charity Activities and Interactions with Local Communities

Pursuant to the Concept of Charity Activities andInteractions with Local Communities adopted in 2010,JSC Atomenergoprom and its organisations have thefollowing as their top priorities in terms of charityactivities:

» implementation of local initiatives aimed atimproving the standards of living and maintainingfavourableenvironmentalconditions;

» implementation of initiatives aimed at protectingpeople’s life and health (including disabled andelderly people, orphaned children, people indistress);

» support of educational initiatives, includingcontests,grantsupporttoeducationalprojectsandprogrammes,advancedtrainingofteachers;

» maintenanceofhighsocialandculturalstandardsintheoperatingareasoftheCompany’sorganisations:- supportofculturalandenlightenmentinitiatives,- dvancedtrainingofcultural,social,andmedical

workers,and- participation in the promotion of patriotism,

dissemination of spiritual values, and thepromotionofgroupsportsandhealthywaysofliving;and

» assistance in forming professional managementtraditions for ensuring the social and economicdevelopmentofthenuclearsitedeploymentareas.In2013,over570charityinitiativeswereimplemented

inside and outside the operating areas of the Company’sorganisations.Thefundingforthecharityactionsamountedto833millionroubles.

In 2013, the industry’s organisations successfullyconducted more than 30 contests of local-level charityinitiatives.Thetotalfundsdistributedonacompetitivebasisamountedtoabout110millionroublesandcovered32citiesinRussia.

FUNDSSPENTFORCHARITYACTIONSINTHENUCLEARINDUSTRYIN2013

106 33185 597986 110112 63

InitiativesonformingthehistoricalandculturalheritageofRussia

Promotionofpatriotismanddonationsfororganisingceremonialeventstimedtocoincidewithcommemorativedatesandmemorialevents

Environmentalinitiativesandtheeliminationofthenuclearlegacy

Free aid on applications, including emergency medical aid andnon-financialparticipation

Initiatives on the development of children’s and group amateursports

Initiativesinthefieldofcultureandspiritualandmoraleducationofyoungpeople

Educational initiatives and support of design activities byeducationalestablishments

Competitivecharityactions

Assistance to war veterans, disabled people, and people indistress

833 millionroubles


3.5.Managementofnaturalcapital,ecologicalsafety,andenvironmentalprotection

3.5.1.ImplementationoftheEnvironmental

Policy

EnvironmentalsafetyisanabsolutetoppriorityintheactivitiesofJSCAtomenergoprom’senterprises.Since 2008, the Environmental Policy has beenimplementedwithintheRussiannuclearindustry.Itsobjective is to ensure the environmentally friendlyand sustainable evolution of nuclear organisationsin the process of atomic energy generation andutilisation.

One of the key organisational activities in 2013was the actualisation of the Environmental PolicypursuanttotheapprovedFundamentalsoftheStatePolicyintheFieldoftheEnvironmentalDevelopmentoftheRussianFederationforthePerioduntil2030,asdictatedbytheneedforimprovingtheenvironmentalsafetyofnuclearsites.

Thesystematicactivitiesfortheimplementationof the Environmental Policy may be carried outonly as part of the existing annual planning andreportingsystem.In2013,55nuclearorganisationswere listed as environmentally significant andthey include facilities with potential sources ofimpactonpeople’shealthandtheenvironment.Inthe reporting year, environmental safety reportswere issued by the environmentally significantorganisations for the purpose of disclosinginformationonactivitiesinthefieldofenvironmentalprotectionandenvironmentalsafety;anumberoforganisational, manufacturing, and technological

arrangements were also undertaken for theprotectionoftheenvironmentandtherationaluseofnaturalresources.

Aspartofthenuclearindustry’sEnvironmentalPolicy,organisationsaremonitoredforhavingvalidenvironmentalpermits(withrespecttoemissionsandthereleaseofharmfulchemicalandradioactivesubstances and the handling of waste, includingradioactivewaste,watermanagement,andsoon).In 2013, 159 nuclear organisations (over 200 withindividualsitestakenintoaccount)deliveredtheirstatisticalenvironmentalprotectionstatements.

In 2013, as part of the Environmental Policyimplementation, JSC Concern RosenergoatomreceivedpositivestateenvironmentalexpertreviewopinionswithrespecttotheoperationoftheRostovNPP’s Unit 1 and the Balakovo NPP’s Unit 3 at apower level of 104% of the rated value. Activitieswere also undertaken to upgrade the productionwaste handling facilities at the Kalinin, Kursk andSmolenskNPPs.

In 2013, the following was done at JSC TVEL aspartoftheenvironmentalpolicyimplementation:

» gascleaningequipmentfortheammoniaemissionentrapmentwascommissioned(JSCCMP);

» work was completed to replace low-efficiencydust catchers on boiler Units 2 and 6 for high-efficiency wet dust-collecting plants (JSC SCC);and

» a mobile plant was put into operation forrecovering the integrity of the uraniumhexafluoride tanks in the depleted uraniumhexafluoride storage area, making it possibleto greatly reduce the emergency radionuclideandhydrogen fluorideemissionsgoing into theenvironment(JSCPAECP).In 2013, as part of the environmental policy

implementation, a full-scale domestic sewagebiological treatment station with a 100 m3/daycapacitywascommissionedwithinJSCAtomenergo-prom(atJSCKhiagda).

By a Russian presidential decree, 2013 wasdeclared the Conservation Year throughout theRussian Federation. The main objective of theConservation Year, conducted by JSC Atomenergo-prom, was to promote the shaping of the public’secological thinking in the nuclear site deploymentareas,thepreservationoffavourableenvironmentalconditions, and the adherence to environmentalsafetyprinciples.

In the reporting year, major organisational,production, technological, information, scientific,public awareness, and regional events, asprovided by the Plan of Activities for the Year ofEnvironmental Protection, were conducted by theindustry’senvironmentallysignificantorganisations(altogether,1.135eventswereconductedwithin theindustry). One of the key organisational events in2013wasacontest,entitledEnvironmentallyPerfectNuclear Organisation, in which 51 environmentallysignificantnuclearorganisationstookpart.ThethreeprizewinnersweretheKurskNPP,theBalakovoNPP,andJSCSCC.

JSC ATOMENERGOPROM AnnualReport 2013- 84 85- 84 85

Annex1.GeneralandspecificGRI(G4)standarddisclosuresandcompliancewiththeRSPPbasicperformanceindicatorsUseofgeneralstandarddisclosures

General standard reporting disclosure Report chapter/section/comment

Strategy and Analysis

G4-1.Statementbythemostseniordecision-makeroftheorganisation(e.g.CEO,chair,orequivalentseniorposition)abouttherelevanceofsustainabilitytotheorganisationanditsstrategy

AddressfromtheChairpersonoftheBoardofDirectorsAddressfromtheDirector

Organisational Profile

G4-3.Nameoftheorganisation Companybackground

G4-4.Primarybrands,products,andservices Companybackground

G4-5.Locationoftheorganisation’sheadquarters JSCAtomenergopromprofile

G4-6. Number of countries where the organisation operates, andnamesofcountrieswitheithermajoroperationsorthatarespecificallyrelevanttothesustainabilityissuescoveredinthereport

Internationalbusiness

G4-7.Natureofownershipandlegalform Companybackground

G4-8. Markets served (including geographic breakdown, sectorsserved,andtypesofcustomersandbeneficiaries)(partiallydisclosed)

EfficientnuclearelectricitysuppliesforRussianindustriesStrengtheningof theglobalplayerposition in theglobalmarketofnuclearservices

G4-9.Scaleofthereportingorganisation(partiallydisclosed) CompanybackgroundFinancialandeconomicperformanceManagementofhumancapital

G4-10.Numberofemployees Managementofhumancapital

G4-11.Percentageoftotalemployeescoveredbycollectivebargainingagreements

Managementofhumancapital

G4-13.Significantchangesduringthereportingperiodregardingtheorganisation’ssize,structure,ownership,oritssupplychain

Corporatemanagement

G4-14.Howprecautionaryprincipleisaddressed Nuclearandradiationsafety

G4-15. Economic, environmental, and social charters, principles,orother initiatives towhich theorganisationsubscribesorwhich itendorses

Internationalcooperation

G4-16. Membership of associations and international/nationaladvocacyorganisations

Internationalcooperation

Identified Material Aspects and Boundaries

G4-22.Explanationof theeffectofanyrestatementsof informationprovidedinearlierreports,andthereasonsforsuchrestatements

Therewerenorestatements

G4-23. Significant changes from previous reporting periods in thescope,boundary,ormeasurementmethodsappliedinthereport

There were no significant changes from the previous reportingperiodsinthereportingyear

Stakeholder Engagement

G4-24.Listofstakeholdergroupsengagedbytheorganisation Interactionswithstakeholders

G4-26.Approachtostakeholderengagement(partiallydisclosed) Interactionswithstakeholders

Report Profile

G4-28. Reporting period (e.g. fiscal/calendar year) for informationprovided

Reportbackground

G4-29.Dateofmostrecentpreviousreport(ifany) Reportbackground

G4-30.Reportingcycle(annual,biennial,etc.) Reportbackground

G4-31.Contactpointforquestionsregardingthereportoritscontents Contactdetails

G4-32.GRIcontentindex Annex 1. General and specific GRI (G4) standard disclosures andcompliancewiththeRUIE’SkeyperformanceindicatorsThisreportcontainsstandarddisclosuresfromtheGRISustainabilityReportingGuidance

G4-33.Externalassurance Thereporthasnotbeenexternallyassured

Governance

G4-34.Governancestructure Corporatemanagement

Ethics and Integrity

G4-56.Values,principles,standards,andnormsofbehaviour,suchascodesofconductandethicalcodes

Annex 3. Observance of the Corporate Conduct Code byJSCAtomenergoprom

GeneralandspecificGRI(G4)standarddisclosuresandcompliancewiththeRSPPbasicperformance

indicators

Indicator Compliance with the RUIE’s base indicator number

Section of Report

Economic performance indicators

G4- ЕС1. Direct economic value generatedanddistributed

1.2.–1.7. Managementofsocialandrelationshipcapital

G4- ЕС3. Coverage of the organization’sdefinedbenefitplanobligations

1.8. Managementofhumancapital

G4- ЕС7. Development and impact ofinfrastructure investments and servicessupported

Managementofsocialandreputationalcapital

G4- ЕС8. Significant indirect economicimpacts,includingtheextentofimpacts

Managementofsocialandreputationalcapital

Labour practices and decent work performance indicators

G4- LA2. Benefits provided to full-timeemployeesthatarenotprovidedtotemporaryor part-time employees, by significantlocationsofoperation


G4-LA4.Minimumnoticeperiodsregardingoperationalchanges,includingwhetherthesearespecifiedincollectiveagreements


G4- LA6. Type of injury and rates of injury,occupational diseases, lost days, andabsenteeism, and total number of work-relatedfatalities,byregionandbygender

3.1.5–3.1.8. Nuclearandradiationsafety

Product responsibility performance indicators

G4- PR1. Percentage of significant productandservicecategories forwhichhealthandsafetyimpactsareassessedforimprovement

RiskmanagementNuclearandradiationsafety


Annex2.AuditCommision’sreportontheauditfindingswithrespecttothefinancialandbusinessactivitiesofJSCAtomenergopromin2013

AuditingCommission’sreportontheauditfindingswithrespecttothefinancialandbusinessactivitiesofJSCAtomenergoprom

in2013

Moscow 16May2014

InaccordancewiththeFederalLaw“OnJoint-StockCompanies”andtheArticlesofAssociationof Joint-Stock Company Nuclear Power Generation Complex (named as “the Company”hereinafter),thefinancialandbusinessactivitiesoftheCompanyin2013wereauditedbytheCompany’sAuditingCommissionintheperiodof5May2014through16May2014.

TheCompany’sAuditingCommissionwasapprovedbyaresolutionoftheSoleShareholderofJoint-StockCompanyNuclearPowerGenerationComplex(No.1,dated28.06.2013).TheAuditingCommission’smembers:

-Kurbatov,GrigoriyAleksandrovich,DeputyChiefAccountant,RosatomStateCorporation(asoftheelectiontime);- Blazhnova, Tatyana Viktorovna, Head, Consolidated Reporting Department, AccountingOffice,RosatomStateCorporation(asoftheelectiontime);and-Zhukova,ZoyaAleksandrovna,ChiefSpecialist, InternalAuditDepartment, InternalAuditOffice,RosatomStateCorporation(asoftheelectiontime).

NoshareholderordirectordemandsforextraordinaryauditsorinspectionstobeconductedwerereceivedbytheAuditingCommissioninthereportingyear.In the course of the audit, the Auditing Commission examined, on a random basis, theconstituent documents, accounting registers, accounting (financial) statements, analyticalmaterials,corporateprocedureobservanceissues,andotherdocumentsthatdisclosethematerialaspectsoftheCompany’sactivities.In the course of the audit, the Auditing Commission relied on, among other things, theCompanyAuditor’sreport,areportbyFBKCompanyLimitedfrom31March2014.

Astheresultoftheaudit,theAuditingCommission:

1.CertifiesthatthedatacontainedintheCompany’sfinancial(accounting)statementsistrue,andthatthefinancialresultsoftheCompany’sactivitiesfor2013arecredible.2.Hasnotrevealedanybreachesofprocedures,asspecifiedinRussianlegalactsforaccountingandfinancialstatementsubmissioninthecourseoffinancialandbusinessactivities,norinRussianlegalactsthatmightmateriallyaffectthecredibilityoftheCompany’sreportingdata.

ChairoftheAuditingCommission T.V.Blazhnova

MembersoftheAuditingCommission Z.A.Zhukova

Annex3.ObservanceoftheCorporateCodeofConductbyJSCAtomenergoprom

No. CCC regulation Applicable / Not applicable

Note

General meeting of shareholders

1. Notification of the shareholders on the general meeting ofshareholders at least 30 days prior to the date of the meeting,notwithstandingtheissuesontheagendathereof,unlessalongertermisprovidedbylaw

Notapplicable For most of the reporting period, thecompany had one shareholder by whichresolutionsarepassedasspecifiedinpar.3,Art.47,ofFederalLawNo.208-FZ(OnJoint-StockCompanies),dated26.12.1995

2. Access of the shareholders to the list of people who are entitledtoattend thegeneralmeetingofshareholders,starting fromthedate of the notice of the general meeting of shareholders untiltheclosureofthegeneralmeetingofshareholdersthatisheldinperson,and,intheeventofageneralmeetingofshareholdersheldremotely,untilthedatewhenthevotingballotsstopbeingcollected


3. Access of the shareholders to the information (materials) to bemade available in the preparations for the general meeting ofshareholders, by means of electronic communications, includingtheInternet


4. Possibility forashareholdertoputan issueontheagendaofthegeneralmeetingofshareholdersorrequireageneralmeetingofshareholderstobecalledwithoutpresentinganextract fromtheshareholders’ register, where the shareholder’s rights to sharesare recorded, where the shareholder’s rights to shares arerecordedinthedepositaccount,presentingastatementfromthedepositaccountwillbeenoughforexercisingtheaboverights


5. Availability in the joint-stockcompany’sarticlesofassociationorbylaws of the requirement regarding the mandatory attendanceof the general meeting of shareholders by the Director General,the members of the Board of Directors, the members of themanagementboard,themembersoftheauditingcommissionandtheauditorofthejoint-stockcompany


6. Mandatory presence of nominees for the positions of membersof the Board of Directors, the Director General, members of themanagement board, and members of the auditing commission,during the discussion by the general meeting of shareholdersregardingtheirpotentialelection,aswellasoftheappointmentofthejoint-stockcompany’sauditor


7. Availabilityinthejoint-stockcompany’sbylawsoftheregistrationprocedureforparticipationinthegeneralmeetingofshareholders


Board of Directors

8. Provisionbythejoint-stockcompany’sarticlesofassociationoftheBoardofDirectors’authoritytoannuallyapprovethefinancialandeconomicplanofthejoint-stockcompany

Applicable Par. 56, subpar. 3, 20 of the Articles ofAssociation

9. Availability in the joint-stock company of a risk managementprocedureapprovedbytheBoardofDirectors

Notapplicable

10. Provision by the joint-stock company’s articles of association ofthe right of theBoardof Directors to suspend thepowersof theDirectorGeneralappointedbythegeneralmeetingofshareholders

Notapplicable

11. Provisionbythejoint-stockcompany’sarticlesofassociationoftherightoftheBoardofDirectorstoestablishrequirementsregardingthequalificationofandthesizeoftheremunerationpayabletotheDirectorGeneral,themembersoftheBoardofDirectors,andtheheadsofthejoint-stockcompany’smajordivisions

Applicable Par. 56, subpar. 12 of the Articles ofAssociation


12. Provisionbythejoint-stockcompany’sarticlesofassociationoftherightoftheBoardofDirectorstoapprovethetermsandconditionsofcontractswiththeDirectorGeneralandthemanagementboardmembers


13. Availability in the joint-stock company’s articles of associationor bylaws of the requirement that the votes of the members ofthe Board of Directors who act as the Director General and themanagementboardmembersshallbetakenintoaccountwhenthetermsandconditionsofthecontractsfortheDirectorGeneral(themanagingorganisation,themanagingdirector)areapproved

Notapplicable

14. Presence on the joint-stock company’s Board of Directors of atleast3independentdirectorsthatmeettheCCCrequirements

Notapplicable

15. Absenceonthejoint-stockcompany’sBoardofDirectorsofanyonewho has been found guilty of committing crimes in the field ofbusiness, crimes against the public order, the public serviceinterests,orthelocalself-governmentserviceinterests,orthosewho have been administratively punished for business, financial,tax,duty,orsecuritiesmarketoffences

Applicable

16. Absence on the joint-stock company’s Board of Directors of anyperson who acts as a member, the Director General (managingdirector),memberofamanagementbody,oranemployeeofanycompetitortothejoint-stockcompany

Applicable

17. Availability in the joint-stock company’s articles of association ofthe requirement that the Board of Directors shall be elected bycumulativevoting


18. Provisionbythe joint-stockcompany’sbylawsoftheobligationofthemembersoftheBoardofDirectorstorefrainfromanyactionsaswillormaypotentiallyleadtoaconflictbetweentheirinterestsand the interests of the joint-stock company, and, where suchconflictarises,oftheobligationtodiscloseinformationonsuchaconflicttotheBoardofDirectors

Notapplicable

19. Provisionbythejoint-stockcompany’sbylawsoftheobligationofamemberoftheBoardofDirectorstonotifytheBoardofDirectorsinwritingoftheintenttomaketransactionswithsecuritiesofthejoint-stockcompanyofwhichheorsheisamemberoftheBoardofDirectors,orofitsdaughter(dependent)companies,aswellasto disclose information on such transactions with securities thataremade

Applicable JSC Atomenergoprom’s order No. 5/65-P,dated29.12.2011

20. Provisionbythejoint-stockcompany’sbylawsoftherequirementthat themeetingsof theBoardofDirectorsshallbeheldat leastonceeverysixweeks

Notapplicable

21. HoldingofmeetingsoftheBoardofDirectorswithafrequencyofatleastonceeverysixweeksintheyearforwhichthejoint-stockcompany’sannualreportisprepared

Applicable There were 97 meetings of the Board ofDirectorsinthereportingperiod

22. Availability inthe joint-stockcompany’sbylawsoftheproceduresforholdingthemeetingsoftheBoardofDirectors

Applicable BylawoftheBoardofDirectors

23. Provisionbythejoint-stockcompany’sbylawsoftherequirementregarding securing the Board of Directors’ approval for anycompanytransactionsforasumof5%ormoreofthecostofthecompany’sassets,excludingthetransactionsmadeintheregularcourseofbusiness


24. Availability in the joint-stock company’s bylaws of the right ofthemembersof theBoardofDirectorstoreceive fromthe joint-stockcompany’sexecutivebodiesandtheheadsofthecompany’smajordivisionstheinformationrequiredbythemtoperformtheirrespectivefunctions,aswellastheliabilityofthosemembersforthefailuretomakesuchinformationavailable


25. Existence of the Board of Directors’ committee on strategicplanningordelegationofthesaidcommittee’sfunctionstoanothercommittee(excludingtheauditcommitteeandthepersonnelandremunerationcommittee)

Notapplicable No Board of Directors committee wasformed

26. Existence of the Board of Director’s committee (the auditcommittee) that recommends the joint-stock company’s auditortotheBoardofDirectorsandcommunicateswithhim/herandthejoint-stockcompany’sauditingcommission


27. Presence on the audit committee of only independent and non-ExecutiveDirectors


28. Leadershipoftheauditcommitteebyanindependentdirector Notapplicable No Board of Directors committee wasformed

29. Provision by the joint-stock company’s bylaws of the right ofaccess of all members of the audit committee to any documentsand information of the joint-stock company, provided that noconfidentialinformationisdisclosedbythem


30. Formation of the Board of Directors committee (personnel andremuneration committee), the function of which is to determinethecriteria for theselectionofnominees for thepositionsof themembers of the Board of Directors and develop the joint-stockcompany’sremunerationpolicy


31. Leadership of the personnel and remuneration committee by anindependentdirector


32. Absenceofthejoint-stockcompany’sofficialsonthepersonnelandremunerationcommittee


33. FormationoftheBoardofDirectors’riskcommitteeordelegationofthesaidcommittee’sfunctionstoanothercommittee(excludingtheauditcommitteeandthepersonnelandremunerationcommittee)


34. FormationoftheBoardofDirectors’corporatedisputesettlementcommittee or delegation of the said committee’s functions toanother committee (excluding the audit committee and thepersonnelandremunerationcommittee)


35. Absence of the joint-stock company’s officials on the Board ofDirectors’corporatedisputesettlementcommittee


36. LeadershipoftheBoardofDirectors’corporatedisputesettlementcommitteebyanindependentdirector


37. Existence of the joint-stock company’s bylaws, as approved bythe Board of Directors, which establish the procedures for theformationandoperationoftheBoardofDirectors’committees


38. Availability in the joint-stock company’s articles of associationof the procedures for determining the quorum of the Board ofDirectorsthatmakesitpossibletoensurethemandatorypresenceofindependentdirectorsatthemeetingsoftheBoardofDirectors

Notapplicable

Executive bodies

39. Existenceofacollectiveexecutivebody(managementboard)ofthejoint-stockcompany

Notapplicable

40. Availabilityinthejoint-stockcompany’sbylawsoftherequirementthat the management board shall approve real estate and loan-raising transactions of the joint-stock company unless these aremajordealsandarebeyondthescopeofthejoint-stockcompany’sregularbusiness

Notapplicable Noformationofacollectiveexecutivebodyisprovided,andrealestatetransactionsaresubject to the approval from the Board ofDirectors

41. Availabilityinthejoint-stockcompany’sbylawsoftheprocedurefortheapprovalofoperationsthatarebeyondthescopeofthejoint-stockcompany’sfinancialandeconomicplan

Notapplicable

42. Absenceofanypeoplewhoactasmembers,theDirectorGeneral(managing director), a member of a management body, or anemployee of a competitor to the joint-stock company on thecompany’sexecutivebodies

Applicable


43. Absence of any people on the joint-stock company’s executivebodieswhohavebeenfoundguiltyofcommittingcrimesinthefieldofbusinessorcrimesagainstthepublicorder,thepublicserviceinterests,andthelocalself-governmentserviceinterests,orwhohave been administratively punished for business, financial, tax,duty, or securities market offences. Where the functions of thesoleexecutivebodyareperformedbythemanagingorganisationortheManagingDirector,complianceofthemanagingorganisation’sDirectorGeneralandmanagementboardmembersortheManagingDirector with the requirements to the joint-stock company’sDirectorGeneralandmanagementboardmembers

Applicable

44. Provision by the joint-stock company’s articles of association orbylaws of a prohibition with respect to the performance by themanaging organisation (Managing Director) of similar functionswithin a competitor company, and with respect to being in anyproperty relations with the joint-stock company, except therendering of services as the managing organisation (ManagingDirector)

Notapplicable

45. Provision by the joint-stock company’s bylaws of the obligationof the executive bodies to refrain from any actions that will orpotentiallymay lead toaconflict between their interestsand thejoint-stockcompany’sinterests,and,intheeventofsuchaconflict,toinformtheBoardofDirectorsofsuchaconflict

Notapplicable

46. Availability in the joint-stockcompany’sarticlesofassociationorbylawsofthecriteriafortheselectionofthemanagingorganisation(ManagingDirector)

Notapplicable

47. Submission by the joint-stock company’s executive bodies ofmonthlyreportsonitsactivitiestotheBoardofDirectors

Notapplicable

48. Provisioninthecontractsmadebythejoint-stockcompanywiththeDirectorGeneral(managingorganisation,ManagingDirector)andthemembersofthemanagementboardoftheliabilityforabreachoftheconfidentialandinsiderinformationbylaw

Applicable

Company secretary

49. Existence within the joint-stock company of a special official(companysecretary)whose function is toensuretheobservancebythejoint-stockcompany’sbodiesandofficialsoftheproceduralrequirementsthatguaranteethattherightsandlawfulinterestsofthecompany’sshareholdersareexercised

Applicable

50. Availability in the joint-stockcompany’sarticlesofassociationorbylaws of the procedures for appointing (electing) the companysecretaryandoftheresponsibilitiesofthecompanysecretary


51. Availability in the joint-stock company’s articles of association ofrequirementsforthenomineecompanysecretary

Notapplicable

Significant corporate actions

52. Availability in the joint-stock company’s articles of associationorbylawsof therequirement thatanymajor transactionshallbeapprovedpriortobeingmade

Notapplicable

53. Mandatory engagement of an independent appraiser for theappraisalofthemarketvalueofthepropertythatisthesubjectofamajortransaction

Notapplicable

54. Availability in the joint-stock company’s articles of associationof the prohibition as to the undertaking, when acquiring majorblocks of shares in the joint-stock company (absorption), of anyactions seeking to protect the interests of the executive bodies(themembersof thesebodies)andthemembersof theBoardofDirectorsofthejoint-stockcompany,and/ormakingthesituationworse for shareholders, as compared to the existing situation,(specifically,oftheprohibitionfortheBoardofDirectorstoresolve,prior to the expiry of the expected stock acquisition period, onadditional convertible securities or the securities entitling to theacquisitionofsharesinthecompanytobeissued,eveniftherightofresolvingsoisprovidedbythearticlesofassociation)

Notapplicable

55. Availability in the joint-stock company’s articles of association oftherequirementforthemandatoryengagementofanindependentappraiser for appraising the current market value of shares andthepotentialchangesinthemarketvaluethereofastheresultoftheabsorption

Notapplicable AnindependentappraiserisengagedonlyinsuchcasesasstipulatedbytheFederalLawonJoint-StockCompanies

56. Absence in the joint-stock company’s articles of association ofa provision that the acquirer shall be relieved of the obligationto propose that the shareholders should sell the shares in thecompany they hold (issuance securities convertible to ordinaryshares)duringtheabsorption

Applicable

57. Availability in the joint-stockcompany’sarticlesofassociationorbylawsoftherequirementthatanindependentappraisershallbemandatorily engaged for determining the stock conversion ratioduringreorganisation

Notapplicable AnindependentappraiserisengagedonlyinsuchcasesasstipulatedbytheFederalLawonJoint-StockCompanies

Disclosure of information

58. Existenceofabylaw,asapprovedbytheBoardofDirectors, thatdefinesthejoint-stockcompany’sinformationdisclosurerulesandapproaches(InformationPolicyBylaw)

Notapplicable Respectivedocumentshavebeenapprovedbythedirector

59. Availabilityinthejoint-stockcompany’sbylawsoftherequirementregardingthedisclosureof informationonthegoalsof theshareplacement,onthepeoplewhoaregoingtoacquirethesharesplaced,includingamajorblockofshares,aswellastherequirementifthejoint-stockcompany’stopofficialswilltakepartintheacquisitionofthejoint-stockcompany’ssharesplaced

Notapplicable Under effective law, the Company’sshares may be held only by RosatomState Corporation and/or by the RussianFederation

60. Availability in the joint-stock company’s bylaws of a list of theinformation,documents,andmaterialstobemadeavailabletotheshareholders for deciding on issues brought before the generalmeetingofshareholders


61. Existence of the joint-stock company’s website and regulardisclosureofinformationonthejoint-stockcompanythereon

Applicable Information is disclosed on the website athttp://www.atomenergoprom.ru

62. Availabilityinthejoint-stockcompany’sbylawsoftherequirementregardingthedisclosureofinformationonthejoint-stockcompany’stransactions with people who, for the purpose of the articles ofassociation,actastopofficialsofthejoint-stockcompany,aswellas on the joint-stock company’s transactions with organisationsin which the joint-stock company’s top officials hold directly orindirectly 20% or more of the joint-stock company’s authorisedcapital,orwhichmaybeinanywaymateriallyinfluencedbysuchpeople

Notapplicable

63. Availabilityinthejoint-stockcompany’sbylawsoftherequirementsforthedisclosureofinformationonalltransactionsasmayaffectthemarketvalueofthejoint-stockcompany’sshares

Notapplicable

64. ExistenceofabylawapprovedbytheBoardofDirectorsconcerningthe use of material information on the joint-stock company’sactivities, the shares and other securities of the company, andthetransactionstherewith,whichisnotpubliclyavailableandthedisclosureofwhichmayhaveamajoreffectonthemarketvalueofthejoint-stockcompany’ssharesandothersecurities

Notapplicable Approvedbythedirector’sorder

Control of financial and economic activities

65. Existenceoftheprocedures,asapprovedbytheBoardofDirectors,for internal control of the joint-stock company’s financial andeconomicactivities

Notapplicable

66. Existence within the joint-stock company of a special divisionto enforce the internal control procedures (control and auditingservice)

Notapplicable

67. Availabilityinthejoint-stockcompany’sbylawsoftherequirementfor the determination by the Board of Directors of the structureandcompositionofthejoint-stockcompany’scontrolandauditingservice

Notapplicable


68. Absence of people in the control and auditing service who havebeenfoundguiltyofcommittingcrimesinthefieldofbusinessorcrimes against the public order, the public service interests andthe local self-government service interests, or who have beenadministratively punished for business, financial, tax, duty, orsecuritiesmarketoffences

Notapplicable

69. Absenceofpeople in thecontrolandauditingservicewhoactasmembers of the joint-stock company’s executive bodies, as wellas of the persons who act as members, the Director General(managing director), members of a management body, or anemployeeofacompetitortothejoint-stockcompany

Notapplicable

70. Provision in the joint-stockcompany’sbylawsof the termfor thedocumentsandmaterialsrequiredfortheappraisalofthefinancialor business transaction to be made available to the control andauditing service, and of the liability of the joint-stock company’sofficialsoremployeesforthefailuretomaketheseavailablewithinthesaidterm

Notapplicable

71. Provision in the joint-stock company’s bylaws of the control andauditingservice’sobligationstoreportthebreachesrevealedtotheauditcommitteeor,wheresuchacommitteehasnotbeenformed,tothejoint-stockcompany’sBoardofDirectors

Notapplicable

72. Availabilityinthejoint-stockcompany’sbylawsoftherequirementforthepreliminaryassessmentbythecontrolandauditingserviceof the practicality of transactions, other than envisaged by thejoint-stock company’s financial and economic plan (nonstandardoperations),tobemade

Notapplicable

73. Availability inthe joint-stockcompany’sbylawsoftheproceduresfor a nonstandard transaction to be authorised by the Board ofDirectors

Notapplicable

74. Existence of a bylaw, approved by the Board of Directors, thatdefinestheproceduresforthejoint-stockcompany’sfinancialandeconomicactivitiestobeauditedbytheauditingcommission

Notapplicable

75. Assessment by the audit committee of the auditors’ report priorto its submission to the shareholders at the general meeting ofshareholders

Notapplicable

Dividends

76. Existenceofabylaw,approvedbytheBoardofDirectors,bywhichtheBoardofDirectorsisguidedwhenmakingrecommendationsonthedividendsize(DividendPolicyBylaw)

Notapplicable

77. Availability in the Dividend Policy Bylaw of the procedures fordetermining a minimum share of the joint-stock company’s netprofit to be paid as dividends, and the conditions under whichnodividendsarepaidorpaid in fullon theprivilegedshares, thedividend size for which is specified by the joint-stock company’sarticlesofassociation

Notapplicable NoDividendPolicyBylawhasbeenapproved

78. Publication of information on the joint-stock company’s dividendpolicyandthechangestothesameinaperiodicalissuedasperthejoint-stockcompany’sarticlesofassociationforthepublicationofnoticesofthegeneralmeetingsofshareholders,andthepostingofsuchinformationonthejoint-stockcompany’swebsite

Notapplicable NoDividendPolicyBylawhasbeenapproved

Annex4.Summaryconsolidatedfinancialstatementspreparedonthebasicofconsolidatedfinancialstatementsfortheyearended31December2013andAuditors’report


2 3


OAO Atomenergoprom

Summary consolidated statement of financial position as at 31 December 2013

(in million Russian roubles)

4

OAO Atomenergoprom

Summary consolidated statement of financial position as at 31 December 2013


5


ОАО Atomenergoprom

Summary consolidated statement of profit and loss for the year ended 31 December 2013



Summary consolidated financial standing statement for the year ended 31 December 2013


6 7



Summary consolidated statement of of changes in equity for the year ended 31 December 2013


OAO Atomenergoprom

Summary consolidated statement of of changes in equity for the year ended 31 December 2013



Summary consolidated statement of changes for the year ended 31 December 2013



Summary consolidated statement of changes in equity for the year ending 31 December 2013


108

9 11



Summary consolidated statement of cash flows for the year ended 31 December 2013

(inmillionRussianroubles)

12


Summary consolidated statement of cash flows for the year ended 31 December 2013


13



Note to the Summary consolidated financial statements for the year ended 31 December 2013

(inmillionRussianroubles)

1 Criterion for the preparation of the summary consolidated financial statements

These summary consolidated financial statements, which include the summaryconsolidated financial standing statement as of 31 December 2013, a summaryconsolidated integrated income statement, a summary consolidated profit andlossstatement,asummaryconsolidatedequity changestatement,andasummaryconsolidatedcashflowstatementfor2013,werepreparedwithnoamendmentsmadeto the respectivestatementsbeing partof theconsolidated financial statementsofJSCAtomenergopromanditsdaughtercompanies,preparedinaccordancewiththeInternationalFinancialReportingStandards, for theyearending31December2013(hereinafter referred to as “consolidated financial statements”). The notes to theconsolidatedfinancialstatementswerenotincludedinthegivensummaryconsolidatedfinancialstatements.

Accordingly,theseconsolidatedfinancialstatementsareinlinewiththeconsolidatedfinancialstatementspublishedonJSCAtomenergoprom’sofficialwebsite.

14


Annex5.ListoftransactionsmadebyJSCAtomenergoprominthereportingperiod,andrecognisedasmajortransactions,towhichtheprocedureforapprovalsofmajortransactionsapplyasspecifiedintheArticlesofAssociation

TherewerenotransactionsmadebyJSCAtomenergopromin2013thatcouldberecognisedasmajortransactionsinaccordancewithRussianlawandrequiredapprovalsfromtheCompany’authorisedmanagementbody.

Annex6.ListofinterestedpartytransactionsbyJSCAtomenergoprominthereportingyear

No. Date of the resolution by the Board of Directors of JSC Atom-energoprom

Material terms and conditions of the interested party transactions, and the requirement for the approval by the Board of Directors of JSC Atomenergoprom

1. 11.01.2013 1)Acquisitionofconsultingservices,betweenJSCAtomenergopromandJSCAtomenergomash,onthefollowingtermsandconditions:Partiestothetransaction:JSCAtomenergoprom(Agent),JSCAtomenergomash(Principal).Subjectofthetransaction:thePrincipalcommissionstheAgentwithmakinganagreementwiththeawardwinnerfortherenderingofconsultingservicesonthetransferpricingissuesonsuchtermsandconditionsasspecifiedintheadditionalagreement.Priceofthetransaction:nomorethan1.400.000.00roubles,VATincluded,plustheAgent’scommissionof1%oftheAgent’sexpenditures.Transactionterm:fromthetimeofthesigningoftheadditionalagreementuntil30.04.2013.

2)Acquisitionofconsultingservices,betweenJSCAtomenergopromandJSCGrinatom,onthefollowingtermsandconditions:Partiestothetransaction:JSCAtomenergoprom(Agent),JSCGrinatom(Principal).Subjectofthetransaction:thePrincipalcommissionstheAgentwithmakinganagreementwiththeawardwinnerfortherenderingofconsultingservicesonthetransferpricingissuesonsuchtermsandconditionsasspecifiedintheadditionalagreement.Priceofthetransaction:nomorethan560.000.00roubles,VATincluded,plustheAgent’scommissionof1%oftheAgent’sexpenditures.Transactionterm:fromthetimeofthesigningoftheadditionalagreementuntil30.04.2013.

3)Acquisitionofconsultingservices,betweenJSCAtomenergopromandJSCAtomredmetzoloto,onthefollowingtermsandconditions:Partiestothetransaction:JSCAtomredmetzoloto(Principal),JSCAtomenergoprom(Agent).Subjectofthetransaction:thePrincipalcommissionstheAgentwithmakinganagreementwiththeawardwinnerfortherenderingofconsultingservices;Priceofthetransaction:nomorethan2.240.000.00roubles,plustheAgent’scommissionof1%.Transactionterm:fromthetimeofthesigningoftheadditionalagreementuntil30.04.2013.

4)Acquisitionofconsultingservices,betweenJSCAtomenergopromandJSCTechsnabexport,onthefollowingtermsandconditions:Partiestothetransaction:JSCAtomredmetzoloto(Principal),JSCAtomenergoprom(Agent).Subjectofthetransaction:thePrincipalcommissionstheAgentwithmakinganagreementwiththeawardwinnerfortherenderingofconsultingservices.Priceofthetransaction:nomorethan1.820.000.00roubles,plustheAgent’scommissionof1%.Transactionterm:fromthetimeofthesigningoftheadditionalagreementuntil30.04.2013.

5)Ongranting therightofuseof theunified industryenterpriseresourcemanagementsystembasedon thesoftwareproduct“1C:ManufacturingEnterpriseManagement8”–1СERP:Rosatom(“theSystem”hereinafter),madebetweenJSCAtomenergopromandJSCOZTMiTSonthefollowingtermsandconditions:Partiestothetransaction:Licensor–JSCAtomenergoprom;Licensee–JSCOZTMiTS.Subjectofthetransaction:theLicensor,beingtheholderoftheexclusiverightsontheunifiedindustryenterpriseresourcemanagementsystembasedonthesoftwareproduct“1C:ManufacturingEnterpriseManagement8”–1СERP:Rosatom(“theSystem”hereinafter),undertakestogranttotheLicenseetherightofuseof(anordinary(nonexclusive)licencefor)theSystem,andtheLicenseeundertakestoremuneratetheLicensorforthegrantingoftherightofuseoftheSysteminsuchamountandonsuchtermsandconditionsasspecifiedintheAgreement.Priceofthetransaction:theremunerationsumis6.169.629(sixmillion,onehundredandsixty-ninethousand,sixhundredandtwenty-nine)roublesand78kopecks.TheremunerationisVAT-exempt,asperArt.149,par.2,subpar.26oftheRussianFederationTaxCode.Term:therightofuseoftheSystemisgrantedbytheLicensortotheLicenseeforatermof3(three)years.

6)Agreementsongrantingtherightofuseofasystem(CorporationSettlementCentreInformationSystem,CSCIS)betweenJSCAtomenergopromandtheindustry’senterprises,aslistedinthetablebelow,onthefollowingtermsandconditions:




Parties Subject Price of transactions (roubles)

Term

Licensee–JSCAtomenergopromSublicensee–JSCUECC

GrantingoftherightofuseoftheCSCIS

909.607.20 4yearsfromthetimeofconclusion

Licensee–JSCAtomenergopromSublicensee–JSCNIKIMTAtomstroy



Licensee–JSCAtomenergopromSublicensee–JSCBalticNPP



Licensee–JSCAtomenergopromSublicensee–JSCNPCC



7) On granting the right of use of intellectual property (CONTENT SERVER ST, WEBTOP CLIENT ST) betweenJSCAtomenergopromand the industry’senterprises,as listed in the tablebelow,on the following termsandconditions:


Term

Licensee–JSCAtomenergopromSublicensee–JSCRusatomService

Agreementongrantingtherightofuseofintellectualproperty(CONTENTSERVERST,WEBTOPCLIENTST)


Licensee–JSCAtomenergopromSublicensee–JSCASE



Licensee–JSCAtomenergopromSublicensee–JSCScienceandInnovations



2. 14.01.2013 Onrenderingconsultingservices,betweenJSCGrinatomandJSCAtomenergoprom,onthefollowingtermsandconditions:Partiestotheagreement:JSCAtomenergoprom(Customer),JSCGrinatom(Contractor).Subjectoftheagreement:TheContractorundertakestorendertotheCustomerfixedassetaccountingservicesasperinternationalfinancialaccountabilitystandardsusingsuchproceduresandonsuchtermsandconditionsasspecifiedintheAgreement.Priceoftheagreement:66.511.286(sixty-sixmillion,fivehundredandeleventhousand,twohundredandeighty-six)roublesand88kopecks,includingan18%VATof10.145.789(tenmillion,onehundredandforty-fivethousand,sevenhundredandeighty-nine)roublesand52kopecks.Termoftheagreement:fromthetimeofconclusionuntilcompletefulfilmentofobligationsbytheparties.

TheLoanAgreementbetweenJSCAtomenergopromandJSCATAonthefollowingtermsandconditions:Partiestothetransaction:JSCATA(Lender),JSCAtomenergoprom(Borrower).Subjectofthetransaction:theLenderprovidesmoneyontheloantermsandconditionsinwholeorinpart,thetotaldebtsumonwhichatalltimesduringtheLoanAgreementvalidityperioddoesnotexceed100.000.000.00(onehundredmillion)roubles,andonsuchtermsandconditionsasspecifiedintheLoanAgreement,andtheBorrowerundertakestorepaythereceivedmoneyandpayaninterestonthesamewithinsuchdatesandusingsuchproceduresasspecifiedintheLoanAgreement.Interestrate:nolessthan3%(threepercent)perannum.TermoftheLoanAgreement:until31December2015,inclusively.Loaningprocedure:TheLendergrantstheloaninkindbytransferringtheloaninwholeorinparttotheBorrower’saccountshownintheBorrower’sApplications,asspecifiedintheBorrower’swrittenApplication.



3. 18.01.2013 1)ThesuretyagreementbetweenJSCAtomenergoprom,JSCNIAEPandJSCConcernRosenergoatominregardtotheobligationsarisingfromworkandservicesagreementNo.5885,dated15.11.2012,madebetweenJSCNIAEPandJSCConcernRosenergoatom,onthefollowingtermsandconditions:

Partiestothetransaction:JSCAtomenergoprom(Guarantor),JSCNIAEP(Debtor),JSCConcernRosenergoatom(Creditor).

Subjectof the transaction: JSCAtomenergopromundertakes tobe liable toJSCConcernRosenergoatom fortheproperfulfilmentofworkandservicesagreementNo.5885,“RenderingofServicestotheOperatorfortheDevelopmentandHandoverofDocumentationRequiredandSufficientforSecuringthePermitstoBuildPowerUnits1and2ofKurskNPPII”,dated15.11.2012.

Termoftheagreement:Thetermofthesuretyagreementisfromthesigningtimeuntil15.07.2016.

2) The surety agreement between JSC Atomenergoprom, JSC NIAEP and JSC Concern Rosenergoatom inregardtotheobligationsarisingfromworkandservicesagreementNo.5810,dated30.10.2012,madebetweenJSCNIAEPandJSCConcernRosenergoatom,onthefollowingtermsandconditions:

Partiestothetransaction:JSCAtomenergoprom(Guarantor),JSCNIAEP(Debtor),JSCConcernRosenergoatom(Creditor).

Subjectof the transaction: JSCAtomenergopromundertakes tobe liable toJSCConcernRosenergoatom fortheproperfulfilmentofworkandservicesagreementNo.5810“DevelopmentofDesignDocumentationfortheConstructionofPowerUnits1and2ofNizhnyNovgorodNPPintheAmountRequiredandSufficientforSecuringtheConstructionLicenceswhileEnsuringtheImprovementintheNPPDesignSafetybasedontheReferencetotheVVER-TOIBaseDesign”,dated30.10.2012.

3)ThesuretyagreementbetweenJSCAtomenergoprom,JSCSPbAEPandJSCAtomstroyexport in regard totheobligationsarisingfromworkandservicesagreementNo.3087/LYG2-7765/11575,dated02.04.2012,madebetweenJSCSPbAEPandJSCAtomstroyexport,onthefollowingtermsandconditions:

Parties to the transaction: JSC Atomenergoprom (Guarantor), JSC SPbAEP (Debtor), JSC Atomstroyexport(Creditor).

4. 21.01.2013 Onrenderingconsultingservices,madebetweenJSCGrinatomandJSCAtomenergoprom,basedonthefollowingtermsandconditions:

Parties to the agreement Subject of the agreement Price of transactions (roubles)

Term of the agreement

JSCAtomenergoprom,JSCGrinatom

RenderingofservicesregardingthecalculationofwagesforthepersonnelofJSCAtomenergopromundertheagreement,andpreparationofreportstobesubmittedtoaspecialisedorganisation

259.883.16 Fromthetimeofconclusionuntilthecompletefulfilmentofobligationsbytheparties.

JSCAtomenergoprom,JSCGrinatom

Renderingofservicesinbookkeepingandtaxaccountingofproperty,liability,andbusinesstransactions,andthepreparationofreports

22.292.955.00 Fromthetimeofconclusionuntilthecompletefulfilmentofobligationsbytheparties.

5. 22.01.2013 1)Onrenderingservicesforthepreparationofconsolidatedtaxpayergroupreports,betweenJSCAtomenergopromandJSCGrinatom,onthefollowingtermsandconditions:Partiestothetransaction:JSCAtomenergoprom(Customer),JSCGrinatom(Contractor).Subjectofthetransaction:theContractorundertakestorender,onapermanentbasisandonsuchtermsandconditionsasspecifiedintheAgreement,servicesforpreparingthereportsofaconsolidatedtaxpayergroup(theCTGhereinafter),asspecifiedinAnnex1totheAgreement,totheCustomerbeingaResponsibleMemberoftheCTG.ThelistoftheCTGmemberorganisationsisgiveninAnnex2oftheAgreement.ThelistandthescopeoftheServicesissubjecttomodificationorupdate,wherebythePartiesmakeamendmentstoAnnexesNos.1,2and3oftheAgreementbysigninganadditionalagreement.Priceofthetransaction:26.917.611(twenty-sixmillion,ninehundredandseventeenthousand,sixhundredandeleven)roublesand00kopecksincludingan18%VATof4.106.076.24(fourmillion,onehundredandsixthousand,seventy-six)roublesand24kopecks.Transactionterm:fromthetimeoftheconclusionuntilthecompletefulfilmentofobligationsbytheparties.




2)TheLoanAgreementmadebetweenJSCAtomenergopromandJSCMachine-BuildingPlant:Partiestothetransaction:JSCAtomenergoprom(Borrower),JSCMachine-BuildingPlant(Lender).Subjectofthetransaction:undertheAgreement,theLendertransferstotheBorrower’sownershipthemoneyintheamountof200.000.000(twohundredmillion)roubles,andtheBorrowerundertakestorepaythereceivedloansumandpayaninterestforusingtheloanwithinsuchdatesandusingsuchproceduresasspecifiedintheAgreement.Loangrantingterm:until31.01.2013.Interestrate:8.95%(eightpointninety-fivepercent)perannum.Termoftheagreement:until06.11.2013.

3)TheLoanAgreementmadebetweenJSCAtomenergopromandJSCMachine-BuildingPlant:Partiestothetransaction:JSCAtomenergoprom(Borrower),JSCMachine-BuildingPlant(Lender).Subjectofthetransaction:undertheAgreement,theLendertransferstotheBorrower’sownershipthemoneyintheamountof400.000.000(fourhundredmillion)roubles,andtheBorrowerundertakestorepaythereceivedloansumandpayaninterestforusingtheloanwithinsuchdatesandusingsuchproceduresasspecifiedinintheAgreement.Loangrantingterm:until31.01.2013.Interestrate:9.1%(ninepointonepercent)perannum.Termoftheagreement:until18.11.2013.

6. 26.10.2012 Theinterestedpartytransaction,–AdditionalAgreementNo.1totheLoanAgreement,dated20.03.2012,betweenJSCAtomenergopromandJSCNPKKhimpromengineering,onthefollowingtermsandconditions:Partiestothetransaction:JSCAtomenergoprom(Lender),JSCNPKKhimpromengineering(Borrower).Subjectofthetransaction:theLenderprovidesthemoneyontheloantermsandconditionsinwholeorinpart,thetotaldebtamountonwhichatalltimesduringtheLoanAgreementvalidityperioddoesnotexceed1.095.400.000(onebillion,ninety-fivemillion,fourhundredthousand)roubles,andonsuchtermsandconditionsasspecifiedintheLoanAgreement,andtheBorrowerundertakestorepaythereceivedloansumandpayaninterestforusingtheloanwithinsuchdatesandusingsuchproceduresasspecifiedintheLoanAgreement.Interestrate:nomorethan11%(elevenpercent)perannum.Termoftheagreement:until31.12.2015.

7. 23.01.2013 1)LoanAgreementmadebetweenJSCAtomenergopromandLLCUnitedInvestingCorporationonthefollowingtermsandconditions:Partiestothetransaction:JSCAtomenergoprom(Lender)andLLCUnitedInvestingCorporation(Borrower).Subjectofthetransaction:theLenderprovidesthemoneyontheloantermsandconditionsinwholeorinpart,thetotaldebtamountonwhichatalltimesduringtheLoanAgreementvalidityperioddoesnotexceed52.000.000(fifty-twomillion)roubles,andonsuchtermsandconditionsasspecifiedintheAgreement,andtheBorrowerundertakestorepaythereceivedloansumandpayaninterestforusingtheloanwithinsuchdatesandusingsuchproceduresasspecifiedintheLoanAgreement.Loangrantingterm:31.12.2015.Interestrate:theloanisgrantedonaninterestrateofnolessthan3%(threepercent)oftheloansumperannum.Termoftheagreement:until31.15.2015.Sourceoffinancing:ownandloanmoneyofJSCAtomenergoprom.

2)ThesuretyagreementmadebetweenJSCAtomenergoprom,LLCESKARMZandJSCKhiagdawithrespecttotheobligationsarisingfromthesulphuricacidsupplyagreementplannedfortheconclusionbetweentheCreditorandtheDebtorastheresultofconductedtenderNo.121026/0619/819,onthefollowingtermsandconditions:Partiestothetransaction:JSCAtomenergoprom(Guarantor),LLCESKARMZ(Debtor),JSCKhiagda(Creditor).Subjectofthetransaction:JSC Atomenergoprom undertakes to be liable to JSC Khiagda for the improper fulfilment by LLC ESK ARMZof its obligations arising from the sulphuric acid supply agreement, in accordance with the name, technicaldocumentation,quality,quantity,anddatesandforsuchpriceasshowninthespecificationenclosedwiththesupplyagreement.Termoftheagreement:Termofthesuretyagreement:fromthetimeofthesigninguntil31.12.2013.

8. 24.01.2013 1)ThesuretyagreementmadebetweenJSCAtomenergoprom,FSUENITInamedafterA.P.Aleksandrov,andJSCVNIIAESwithrespect to theobligationsarising fromequipmentsupplyagreementNo.7000/54-17,dated15.10.2012,madebetweenFSUENITInamedafterA.P.AleksandrovandJSCVNIIAES,onthefollowingtermsandconditions:Partiestothetransaction:JSCAtomenergoprom(Guarantor),FSUENITInamedafterA.P.Aleksandrov(Debtor),JSCVNIIAES(Creditor).Subjectofthetransaction:JSCAtomenergopromundertakes tobe liable toJSCVNIIAES for the improper fulfilmentby theDebtorof itsobligationsarisingfromequipmentsupplyagreementNo.7000/54-17,dated15.10.2012.Termoftheagreement:thetermofthesuretyagreementisfromthetimeofsigninguntil25.12.2013.



8. 24.01.2013 2)ThesuretyagreementmadebetweenJSCAtomenergoprom,FSUENITInamedafterA.P.Aleksandrov,andJSC VNIIAES with respect to the obligations arising from equipment supply agreement No.7000/54-17, dated15.10.2012,madebetweenFSUENITInamedafterA.P.AleksandrovandJSCVNIIAES,onthefollowingtermsandconditions:Partiestothetransaction:JSCAtomenergoprom(Guarantor),FSUENITInamedafterA.P.Aleksandrov(Debtor),JSCVNIIAES(Creditor).Subjectofthetransaction:JSCAtomenergopromundertakestobeliabletoJSCVNIIAESfortherepaymentoftheadvancemoneytransferredasperpar.7.1ofequipmentsupplyagreementNo.7000/54-17,dated15.10.2012.Termoftheagreement:Thetermofthesuretyagreementisfromthetimeofsigninguntil25.12.2013.

9. 29.01.2013 TheLoanAgreementmadebetweenJSCAtomenergopromandJSCPOMZMolniyaonthefollowingtermsandconditions:Partiestothetransaction:JSCPOMZMolniya(Lender),JSCAtomenergoprom(Borrower).Subjectofthetransaction:theLenderprovidesmoneyontheloantermsandconditionsinwholeorinpart,thetotaldebtamountonwhichatalltimesduringtheLoanAgreementvalidityperioddoesnotexceed15.000.000(fifteenmillion)roubles,andonsuchtermsandconditionsasspecifiedintheLoanAgreement,andtheBorrowerundertakestorepaythereceivedloansumandpayaninterestforusingtheloanwithinsuchdatesandusingsuchproceduresasspecifiedintheLoanAgreement.Interestrate:nolessthan3%(threepercent)perannum.TermoftheLoanAgreement:upto31December2013inclusively.Loangrantingprocedure:theLendergrantstheloanbytransferringtheloanmoneytotheBorrower’saccountinwholeorinpartinaccordancewiththeBorrower’swrittenApplications.

10. 30.01.2013 1)TheAgencyAgreementmadebetweenJSCAtomenergopromandLLCUnited InvestingCorporationon thefollowingtermsandconditions:Partiestothetransaction:JSCAtomenergoprom(Agent)andLLCUnitedInvestingCorporation(Principal).Subjectofthetransaction:Under theAgreement, thePrincipalcommissions theAgent inwriting,and theAgentundertakes,on itsownbehalfbutforthePrincipal’saccount,toperformactivitiesforsearchingfororganisationsthatrenderservicesinthesourcingandselectionofmanagerialstaff,andmakeagreementswithsaidorganisationsfortherenderingofsourcingandselectionservicestothePrincipal.Agent’scommission:theAgent’scommissionis1%(onepercent)ofthepriceoftheservices.Termoftheagreement:until31.12.2013.

2)OntherenderingofprojectmanagementserviceswithrespecttoprojectNo.111-01050“CompletionoftheAutomatedBudgetingSystem(ABS)subjecttotheRequirementsoftheUpdatedEPS”betweenJSCGrinatomandJSCAtomenergoprom,onthefollowingtermsandconditions:Parties:JSCAtomenergoprom–Customer,JSCGrinatom–Contractor.Subjectof the transaction:on theCustomer’scommission, theContractorundertakes to render theservicesforthemanagementofprojectNo.111-01050“CompletionoftheAutomatedBudgetingSystem(ABS)subjecttotheRequirementsoftheUpdatedEPS”(referredtoas“theProject”hereinafter),asperAnnexesNo.1and2tothisAgreement (“theServices”hereinafter),andtheCustomerundertakestoacceptandpayfortheservicesrenderedwithinsuchdatesandusingsuchproceduresasspecifiedintheAgreement.Priceoftheagreement:2.400.903(twomillion,fourhundredthousand,ninehundredandthree)roublesand00kopecks,includingan18%VATof366.239(threehundredandsixty-sixthousand,twohundredandthirty-nine)roublesand45kopecks.Termoftheagreement: fromthetimeoftheconclusionuntil thecompletefulfilmentof theobligationsbytheparties.

11. 01.02.2013 Additional agreement No.2 to agency agreement No. 1/2259-D/5/1432-D, dated 22 February 2012, as madebetweenRosatomStateCorporationandJSCAtomenergopromonthefollowingtermsandconditions:Partiestothetransaction:RosatomStateCorporation(Agent),JSCAtomenergoprom(Principal).Subjectofthetransaction:thePrincipalcommissionstheAgentinwritingandtheAgentcommitsitself,onitsownbehalfbutforthePrincipal’saccount,toperformactivitiesforthevoluntaryhealthinsuranceofthepersonnelofJSCAtomenergopromandtheirfamilymembers.Priceofthetransaction:–thepriceoftheserviceis807.976(eighthundredandseventhousand,ninehundredandseventy-six)roublesand75kopecks,–theAgent’scommissionis1%(onepercent)ofthepriceoftheservices,includingan18%VAT.Termoftheagreement:until31December2013.




12. 04.02.2014 1)ThesuretyagreementbetweenJSCAtomenergoprom,JSCOKBMAfrikantov,andJSCConcernRosenergoatomconcerningtheobligationsarisingfromworkagreementNo.9/1713-D,dated28.08.2012,madebetweenJSCOKBMAfrikantovandJSCConcernRosenergoatom,onthefollowingtermsandconditions:Parties to the transaction: JSC Atomenergoprom (Guarantor), JSC OKBM Afrikantov (Debtor), JSC ConcernRosenergoatom(Creditor).Subjectof the transaction:JSCAtomenergopromundertakes tobe liable toJSCConcernRosenergoatomfor therepaymentoftheadvancemoneytransferredasperpar.2.3ofagreementNo.9/1713-D,dated28.08.2012,fortheresearchanddevelopmenteffortentitled“R&DfortheFeasibilityStudyoftheBN-1200ReactorCore”.Price:37.500.000.00(thirty-sevenmillion,fivehundredthousand)roubles.Termoftheagreement:thetermofthesuretyagreementisfromthetimeofthesigninguntil05.12.2016.

2)ThesuretyagreementmadebetweenJSCAtomenergoprom,JSCOKBMAfrikantov,andJSCConcernRosenergoatomwithrespecttotheobligationsarisingfromworkagreementNo.9/1713-D,datedasof28.08.2012,madebetweenJSCOKBMAfrikantovandJSCConcernRosenergoatom,onthefollowingtermsandconditions:Parties to the transaction: JSC Atomenergoprom (Guarantor), JSC OKBM Afrikantov (Debtor), JSC ConcernRosenergoatom(Creditor).Subjectofthetransaction:JSCAtomenergopromundertakestobeliabletoJSCConcernRosenergoatomfortheproperfulfilmentofcontractNo.9/1713-D,dated28.08.2012,fortheresearchanddevelopmenteffortentitled“R&DfortheFeasibilityStudyoftheBN-1200ReactorCore”.Price:6.250.000.00(sixmillion,twohundredandfiftythousand)roubles.Termoftheagreement:Thetermofthesuretyagreementisfromthetimeofthesigninguntil05.12.2016.

3) The surety agreement made between JSC Atomenergoprom, JSC SPbAEP, and JSC Concern Rosenergoatomconcerning the obligations arising from work agreement No. 3115/BN/5611, dated 07.06.2012, as amended byAdditionalAgreementNo.1,dated14.12.2012,madebetweenJSCSPbAEPandJSCConcernRosenergoatom,onthefollowingtermsandconditions:Partiestothetransaction:JSCAtomenergoprom(Guarantor),JSCSPbAEP(Debtor),JSCConcernRosenergoatom(Creditor).Subjectof the transaction:JSCAtomenergopromundertakes tobe liable toJSCConcernRosenergoatomfor theproper fulfilmentofagreementNo.3115/BN/5611,dated07.06.2012 (asamendedbyAdditionalAgreementNo.1,dated14.12.2012),fortheeffortentitled“R&DfortheFeasibilityStudyoftheBN-1200NPPDesign”.Price:22.600.000(twenty-twomillion,sixhundredthousand)roubles.Termoftheagreement:Thetermofthesuretyagreementisfromthetimeofthesigninguntil05.12.2016.

4)ThesuretyagreementmadebetweenJSCAtomenergoprom,JSCIndustrialInnovations,andJSCOKBMAfrikantovconcerningtheobligationsarisingfromagreementNo.25/35/382,dated09.10.2012,asmadebetweenJSCIndustrialInnovationsandJSCOKBMAfrikantov,onthefollowingtermsandconditions:Parties to the transaction: JSC Atomenergoprom (Guarantor), JSC Industrial Innovations (Debtor), JSC OKBMAfrikantov(Creditor).Subjectofthetransaction:JSCAtomenergopromundertakestobeliabletoJSCOKBMAfrikantovfortherepaymentoftheadvancemoneytransferredaspersubpar.2.4ofcontractNo.25/35/382,dated9October2012.Price:18.974.500.00(eighteenmillion,ninehundredandseventy-fourthousand,fivehundred)roubles.Termoftheagreement:Thetermofthesuretyagreementisfromthetimeofthesigninguntiltheactualdateoftheequipmentsupplytotheconsigneeasperpar.1.2ofagreementNo.25/35/382,dated09.10.2012,plus365(threehundredandsixty-five)calendardays.

13. 07.02.2013 1) The surety agreement made between JSC Atomenergoprom and Nomos-Bank (Joint-Stock Company) on thefollowingtermsandconditions:Parties to the transaction: JSC Atomenergoprom (Guarantor), Nomos-Bank (Joint-Stock Company) (Creditor),JSCVNIIAM(Debtor).Subjectofthetransaction:JSCAtomenergopromundertakestobeliabletoNomos-Bank(Joint-StockCompany)forthefulfilmentbyJSCVNIIAMofallitsobligationstotheCreditor,asarisingfrombankguaranteeagreementNo.1808-12/DBG,infavourofJoint-StockCompanyDirectorateoftheIntegratedOrderfortheNPPEquipment(JSCDIO).Price:tobedeterminedbasedonthefollowingindicators:– overall scope of liability under the guarantee – 63.679.933 (sixty-three million, six hundred and seventy-ninethousand,ninehundredandthirty-three)roublesand84kopecks;–commissionforgrantingtheguarantee-0.3%(naughtpointthreetenthspercent)perannumoftheGuaranteesum;–theone-timecommissionis10.000.00(tenthousand)roubles;–bankguaranteevalidityperiod:fromthetimeofthegrantinguntil30April2014;–intheeventoftheDebtor’sfailuretofulfilorproperlyfulfilitsobligationstotheCreditor,theDebtorwillpaytotheCreditorapenaltyof5.000.00(fivethousand)roubles;and–intheeventoftheDebtor’sfailuretofulfilorproperlyfulfilthesurety-securedobligation,theGuarantorandtheDebtorshallbesolidaryliabletotheCreditor.Termoftheagreement:Thetermofthesuretyagreementisfromthetimeofthesigninguntil30.07.2016.



2)OnprovidingasecurityintheformofsuretyNo.5/2319-DmadebetweenJSCAtomenergopromandJSCVNIIAM,onthefollowingtermsandconditions:Partiestothetransaction:JSCAtomenergoprom(Guarantor),JSCVNIIAM(Debtor).Subjectofthetransaction:JSCAtomenergopromundertakestomakeasuretyagreementwithNomos-Bank(Joint-StockCompany)asasecuritywithrespecttotheproperfulfilmentbyJSCVNIIAMofallitsobligationsarisingfrombankguaranteeagreementNo.1808-12/DBG.Priceofthetransaction:1.180.00(onethousandonehundredandeighty)roubles,includingan18%VATof180.00(onehundredandeighty)roubles.Termoftheagreement:Thetermoftheagreementofsecurityintheformofsuretyisfromthetimeofthesigninguntil30.07.2016.Othermaterialtermsandconditionsofthetransaction:theGuarantor’sobligationsshallbedeemedtohavebeenfulfilledatthetimeoftheconclusionofthesuretyagreement.

3) The surety agreement made between JSC Atomenergoprom and Nomos-Bank (Joint-Stock Company) on thefollowingtermsandconditions:Partiestothetransaction:JSCAtomenergoprom(Guarantor),Nomos-Bank(OpenJoint-StockCompany)(Creditor),JSCVNIIAM(Debtor).Subjectofthetransaction:JSCAtomenergopromundertakestobeliabletoNomos-Bank(Joint-StockCompany)forthefulfilmentbyJSCVNIIAMofallitsobligationstotheCreditor,arisingfrombankguaranteeagreementNo.1810-12/DBGinfavourofJoint-StockCompanyDirectorateoftheIntegratedOrderfortheNPPEquipment(JSCDIO).Price:tobedeterminedbasedonthefollowingindicators:–overallscopeofliabilityundertheguarantee–7.959.991(sevenmillion,ninehundredandfifty-ninethousand,ninehundredandninety-nine)roublesand73kopecks;–commissionforgrantingtheguarantee-0.3%(naughtpointthreepercent)perannumoftheGuaranteesum;–theone-timecommissionis10.000.00(tenthousand)roubles;–bankguaranteevalidityperiod:fromthetimeofthegrantinguntilMay30,2014;–intheeventoftheDebtor’sfailuretofulfilorproperlyfulfilitsobligationstotheCreditor,theDebtorwillpaytotheCreditorapenaltyof5.000.00(fivethousand)roubles;and–intheeventoftheDebtor’sfailuretofulfilorproperlyfulfilthesurety-securedobligation,theGuarantorandtheDebtorshallbesolidaryliabletotheCreditor.Termoftheagreement:Thetermofthesuretyagreementisfromthetimeofthesigninguntil30.08.2016.

4)OnprovidingasecurityintheformofsuretyNo.5/2318-DmadebetweenJSCAtomenergopromandJSCVNIIAMonthefollowingtermsandconditions:Partiestothetransaction:JSCAtomenergoprom(Guarantor),JSCVNIIAM(Debtor).Subjectofthetransaction:JSCAtomenergopromundertakestomakeasuretyagreementwithNomos-Bank(OpenJoint-StockCompany)asasecurityfortheproperfulfilmentbyJSCVNIIAMofallitsobligationsarisingfrombankguaranteeagreementNo.1810-12/DBG.Priceofthetransaction:1.180.00(onethousand,onehundredandeighty)roubles,includingan18%VATof180.00(onehundredandeighty)roubles.Termoftheagreement:Thetermoftheagreementonprovidingasecurityintheformofsuretyisfromthetimeofthesigninguntil30.08.2016.Othermaterialtermsandconditionsofthetransaction:theGuarantor’sobligationsshallbedeemedtohavebeenfulfilledatthetimeoftheconclusionofthesuretyagreement.

5)ThesuretyagreementmadebetweenJSCAtomenergopromandNomos-Bank(OpenJoint-StockCompany)onthefollowingtermsandconditions:Partiestothetransaction:JSCAtomenergoprom(Guarantor),Nomos-Bank(OpenJoint-StockCompany)(Creditor),JSCVNIIAM(Debtor).Subjectofthetransaction:JSC Atomenergoprom undertakes to be liable to Nomos-Bank (Joint-Stock Company) for the fulfilment by JSCVNIIAMofallitsobligationstotheCreditor,arisingfrombankguaranteeagreementNo.3245-12/DBG,infavourofJoint-StockCompanyGruppaE4 (location:12Krasnopresnenskayanaberezhnaya,entrance9,Moscow12123610,TIN7720554943,RRC774501001).Price:tobedeterminedbasedonthefollowingindications:–overallscopeofliabilityundertheguarantee–5.070.600(fivemillion,seventythousand,andsixhundred)roubles;–commissionforgrantingaguarantee-0.3%(naughtpointthreepercent)perannumoftheguaranteesum;–theone-timecommissionis10.000.00(tenthousand)roubles;–bankguaranteevalidityperiod:fromthetimeofgrantinguntil14July2013;–intheeventoftheDebtor’sfailuretofulfilorproperlyfulfilitsobligationstotheCreditor,theDebtorwillpaytheCreditorapenaltyof5.000.00(fivethousand)roubles;and–intheeventoftheDebtor’sfailuretofulfilorproperlyfulfilthesurety-securedobligation,theGuarantorandtheDebtorshallbejointlyliabletotheCreditor.Termoftheagreement:Thetermofthesuretyagreementisfromthetimeofthesigninguntil14.10.2015.




6)OnprovidingasecurityintheformofsuretyNo.5/2320-DmadebetweenJSCAtomenergopromandJSCVNIIAM,onthefollowingtermsandconditions:Partiestothetransaction:Guarantor–JSCAtomenergoprom,Debtor–JSCVNIIAM.Subjectofthetransaction:JSCAtomenergopromundertakestomakeasuretyagreementwithNomos-Bank(OpenJoint-StockCompany)asasecuritywith respect to theproper fulfilmentbyJSCVNIIAMofall itsobligationsarising frombankguaranteeagreementNo.3245-12/DBG.Priceofthetransaction:1.180.00(onethousand,onehundredandeighty)roubles,includingan18%VATof180.00(onehundredandeighty)roubles.Termoftheagreement:Thetermoftheagreementonprovidingasecurityintheformofsuretyisfromthetimeofthesigninguntil14.10.2015.Othermaterialtermsandconditionsofthetransaction:theGuarantor’sobligationsshallbedeemedtohavebeenfulfilledatthetimeoftheconclusionofthesuretyagreement.

7) The surety agreement between JSC Atomenergoprom, JSC Atomenergoproekt, and JSC Atomstroyexport withrespecttotheobligationsarisingfromworkandservicesagreementNo.7717/12073/12120/222,dated25.12.2012,madebetweenJSCAtomstroyexportandJSCAtomenergoproekt,onthefollowingtermsandconditions:Partiestothetransaction:JSCAtomenergoprom(Guarantor),JSCAtomenergoproekt(Debtor),JSCAtomstroyexport(Creditor).Subjectofthetransaction:JSC Atomenergoprom undertakes to be liable to JSC Atomstroyexport for the improper fulfilment byJSCAtomenergoproektofitsobligationsarisingfromagreementNo.7717/12073/12120/222,dated25.12.2012,fortheeffortentitled“DevelopmentofEngineeringSurveyMaterialsfortheAkkuyuNPPSiteintheTurkishRepublic,DesignDocumentationPhase”.Price:5.000.000.00(fivemillion)roublesand00kopecks.Termoftheagreement:Thetermofthesuretyagreementisfromthetimeofthesigninguntil04.03.2014.

14. 08.02.2013 1) The surety agreement between JSC Atomenergoprom, JSC Industrial Innovations, and JSC OKBM Afrikantovconcerning the obligations arising from agreement No. 25/35/467, dated 28 December 2012, made betweenJSCIndustrialInnovationsandJSCOKBMAfrikantov,onthefollowingtermsandconditions:Parties to the transaction: JSC Atomenergoprom (Guarantor), JSC Industrial Innovations (Debtor), JSC OKBMAfrikantov(Creditor).Subjectofthetransaction:JSCAtomenergopromundertakestobeliabletoJSCOKBMAfrikantovforthetimelyfulfilmentbytheDebtorofitsobligationsarisingfromagreementNo.25/35/467,dated28December2012.Price:9.975.000.00(ninemillion,ninehundredandseventy-fivethousand)roubles.Termoftheagreement:Thetermofthesuretyagreementisfromthetimeofthesigninguntiltheactualdateoftheequipmentsupplytotheconsigneeasperpar.1.2ofagreementNo.25/35/467,dated28December2012,plus365(threehundredandsixty-five)calendardays.

2)ThesuretyagreementbetweenJSCAtomenergoprom,JSCVNIPIpromtekhnologii,andJSCDalurwithrespecttotheobligationsarisingfromagreementNo.099/2012/12-03/321-2246,dated6November2012,madebetweenJSCVNIPIpromtekhnologiiandJSCDaluronthefollowingtermsandconditions:Parties to the transaction: JSC Atomenergoprom (Guarantor), JSC VNIPIpromtekhnologii (Debtor), JSC Dalur(Creditor).Subjectofthetransaction:JSCAtomenergopromundertakestobeliabletoJSCDalurfortheimproperfulfilmentbytheDebtorofitsobligationsarisingfromagreementNo.099/2012/12-03/321-2246,dated6November2012madewiththeCreditor.Price:959.353.80(ninehundredandfifty-ninethousand,threehundredandfifty-three)roublesand80kopecks.Termoftheagreement:Thetermofthesuretyagreementisuntil28.04.2013.

3)ThesuretyagreementmadebetweenJSCAtomenergoprom,JSCVNIPIpromtekhnologii, andJSCPPMCAwithrespecttotheobligationsarisingfromcontractoragreementNo.100-10-05/18312,dated04.12.2012,madebetweentheCreditorandtheDebtor,onthefollowingtermsandconditions:Parties to the transaction: JSC Atomenergoprom (Guarantor), JSC VNIPIpromtekhnologii (Debtor), JSC PPMCA(Creditor).Subjectofthetransaction:JSCAtomenergopromundertakestobeliabletoJSCPPMCAfortheimproperfulfilmentbyJSCVNIPIpromtekhnologiiofitsobligationsarisingfromthecontractoragreement.Price:5.000.000.00(fivemillion)roublesand00kopecks.Termoftheagreement:Thetermofthesuretyagreementisfromthetimeofthesigninguntil15.12.2014.



4)Ongrantingtherightofuseofasystem(UnifiedIndustryElectronicDocumentManagementSystem,UIEDMS)betweenJSCAtomenergopromandtheindustry’senterprises,aslistedinthetablebelow,onthefollowingtermsandconditions:


Term

Licensor–JSCAtomenergopromLicensee–JSCLeadingResearchInstituteofChemicalTechnology(VNIIKhT)

GrantingoftherightofuseoftheUIEDMS


Licensor–JSCAtomenergopromLicensee–JSCScienceandInnovations



Licensor–JSCAtomenergopromLicensee–JSCPilotDesignBureauofMachine-BuildingnamedafterI.I.Afrikantov(JSCOKBMAfrikantov)


24.701.269.96 4yearsfromthetimeofconclusion

Licensor–JSCAtomenergopromLicensee–JSCAtomkomplekt



Licensor–JSCAtomenergopromLicensee–JSCKovrovMechanicalPlant



Licensor–JSCAtomenergopromLicensee–JSCNovosibirskPlantofChemicalConcentrates



Licensor–JSCAtomenergopromLicensee–JSCAngarskElectrolysisChemicalCombine



Licensor–JSCAtomenergopromLicensee–JSCTENEX-Komplekt



Licensor–JSCAtomenergopromLicensee–JSCKraun




ListofAbbreviations

AAED annualaverageeffectivedose

AEIC atomicenergyinformationcentres

ARSMS automatedradiationsituationmonitoringsystem

BOO build-own-operate

CATF closedadministrativeandterritorialformation

CNFC closednuclearfuelcycle

CIS CommonwealthofIndependentStates

CRMS corporateriskmanagementsystem

EBIDTA EarningsBeforeInterestDepreciationTaxandAmortisation

ESS examinationandsearchsystem

EUP enricheduraniumproduct

EurAsEC EurasianEconomicCommunity

FA fuelassembly

FFMS FederalFinancialMarketsService

FSMC FederalSecuritiesMarketCommission

FTP federaltargetprogramme

FTS FederalTariffService

HEU highlyenricheduranium

HLW high-levelwaste

IAEA InternationalAtomicEnergyAgency

ICUF installedcapacityutilisationfactor

IFRS InternationalFinancialReportingStandards

IGA intergovernmentalagreement

INES InternationalNuclearEventScale

IP intellectualproperty

IRAW individualriskassessmentworkstation

IRG inertradioactivegas

ITER InternationalThermonuclearExperimentalReactor

IUEC InternationalUraniumEnrichmentCentre

JSC joint-stockcompany

JV jointventure

KPI keyperformanceindicator

LC lifecycle

LEU low-enricheduranium

LRW liquidradioactivewaste

LWR light-waterreactors

MSSC multifunctionalsharedservicingcentre

NFC nuclearfuelcycle

NFC FE nuclearfuelcyclefront-end

NPP nuclearpowerplant

NRHI nuclear-andradiation-hazardousinstallation

NRS nuclearandradiationsafety

OECD NEA OrganisationforEconomicCooperationandDevelopmentNuclearEnergyAgency

PSRN primarystateregistrationnumber

R&D researchanddevelopment

ROSATOM theStateAtomicEnergyCorporation“Rosatom”

RBMK high-powerchannel-typereactor

RF RussianFederation

Rostekhnadzor FederalEnvironmental,TechnologicalandNuclearSupervisionService

RUIE RussianUnionofIndustrialistsandEntrepreneurs

RW radioactivewaste

SNF spentnuclearfuel

SWU separativeworkunit

TIN taxpayeridentificationnumber

UIDMS unifiedindustrydocumentmanagementsystem

UNO UnitedNationsOrganisation

USRS unifiedstandardisedremunerationsystem

VVER water-cooledwater-moderatedpowerreactor


Glossary

BOO (Build – Own – Operate) contract acontractthatprovidesfortheobligationoftheconstruction,ownership,andoperationofafacility.

Closed nuclear fuel cycle anuclear fuelcycle, inwhichspentnuclear fuel isprocessed foruraniumandplutoniumextractionfornuclearfuelre-fabrication.

Corporate social accountability aconceptbasedonwhichanorganisationtakesaccountofthestakeholderrequests.Thisisapackageofobligationsgenerated,onavoluntarybasis,bytheorganisation’sexecutiveswithregardtotheinterestsofpersonnel,shareholders,localcommunitiesintheoperatingareas,state,andmunicipalpowerbodies,andotherstakeholders.Theseobligationsare largelyfulfilled at the expense of the organisation’s funds and are aimed at the implementationof significant internal and external social (in the broad sense of the word) programmes,theresultsofwhichcontributetothedevelopmentoftheorganisationandtoitsimprovedreputationandimage,aswellastoconstructivestakeholderengagement.

Depleted uranium uraniumthatcontainslessisotopesofU-235thannaturaluranium(forexample,uraniuminthespentfuelofreactorsfuelledbynaturaluranium).

Dialogue with STAKEHOLDERS (as part of the annual report preparation)

anarrangementundertakenundertheAA100internationalstandardsfortheengagementof representatives of the stakeholders during the report preparation to enhance theorganisation’stransparencyandaccountability.

Dump of radioactive material controlledentryofradionuclidesintowaterbodieswithliquidwasteofanuclearfacility(e.g.anuclearplant).

Enrichment (isotopic) a)thecontentofatomsofacertainisotopeintheisotopicmixtureofthesameelementifthisexceedstheshareofthegivenisotopeinanaturallyoccurringmixture(expressedasapercentage);b)aprocessresultinginanincreasedcontentofacertainisotopeintheisotopicmixture.

EPC (Engineering – Procurement - Construction) contract

acontractthatprovidesfortheobligationoftheturnkeyconstructionofafacility,includingthefacilityengineering,supply,andconstructionobligations.UnlikeaBOOContract,itdoesnotprovidefortheownershipofthefacilitytobebuilt.

EPCM (Engineering – Procurement – Construction - Management) contract

acontractthatprovidesfortheobligationoftheturnkeyconstruction(includingengineering,supply,andconstruction)andmanagementofafacility.UnlikeaBOOContract,itdoesnotprovidefortheownershipofthefacilitytobebuilt.

Fast neutrons neutrons,thekineticenergyofwhichexceedsaparticulargivenmagnitude.Thismagnitudeisvariableinabroadrangeanddependsontheapplication(reactorphysics,protection,orradiationmonitoring).Inreactorphysics,thismagnitudeismostlyselectedasequalling0.1MeV.

First criticality astageinthenuclearplantcommissioning,includingthereactorfuelling,firstcriticality,andrequiredphysicalexperimentsconductedatthepowerlevelatwhichheatisremovedfromthereactorthankstonaturalheatlosses.

Fuel assembly a package of fuel elements (rods, bars, plates, and others) held together with the aid ofspacergridsandotherstructuralmembers,whichareintegralduringtransportationandin-pileirradiation.Assembliesareloadedintothenuclearreactorcore.

Global Reporting Initiative (GRI) an international reporting system concerning the economic, environmental and socialperformance, based on the Sustainability Reporting Guidelines, Technical Protocols, andindustryapplications.

HEU-LEU Agreement the Agreement between the Government of the Russian Federation and the Governmentof the United States of America Concerning the Disposition of Highly-Enriched UraniumExtractedfromNuclearWeapons,underwhichRussiahadcommitteditselftosupplyingtotheUSAduring20years(untiltheendof2013)low-enricheduranium(LEU)obtainedfrom500tonnesofhighlyenricheduranium(HEU)extractedfromnuclearwarheadsandfoundbytheRussiansidetobeexcessivefordefensiveapplications.

Installed capacity utilisation factor (ICUF) the relation of the actual electricity generation by a reactor facility during the period ofoperationtotheelectricitygenerationduringrated-poweroperationswithnoshutdowns.

Integrated report a report that consolidates all material data on the organisation’s strategy, corporatemanagement, performance indicators, and prospects such that it would “show” in anintegratedwaytheorganisation’seconomic,social,andenvironmentalstatus.Thereportgivesaclearanddistinctideaabouthowtheorganisationcarriesoutreasonablecontrol,aswellashowitcreatesitsvalueatthepresenttimeorwillcreateitinfuture.

International Integrated Reporting Council (IIRC)

aninternationalorganisationengagedinthedevelopmentofagloballyintegratedreportingstandard to allow for managerial, financial, social, environmental, and other informationto be provided in an understandable, concise, self-consistent, and comparable reportingdocument.TheIIRCobjectiveistodevelopversatileapproachestothedeliveryofcorporatereportsinordertocontributetothesustainabledevelopmentofglobaleconomy.

Key performance indicators (KPI) keyefficiency indicatorsmeeting thegoalsofRosatomStateCorporation,whichdisclosetheefficiencyandperformanceoforganisations(andoftheactivitiesbydivisions)andtheindividualefficiencyofemployees.

Non-financial reporting reporting provided by an organisation regarding its performance outside the scope ofmanufacturing and financial activities (and the management of this performance). Non-financialreportingincludessustainabledevelopmentreports,corporatesocialaccountabilityreports,environmentalreports,charityreports,andothers.

Nuclear fuel amaterialcontainingfissionablenuclides,which,beingplacedinthenuclearreactor,makesitpossibletorunanuclearchainreaction.

Nuclear fuel cycle thesequenceofmanufacturingprocessesforensuringtheoperationofnuclearreactors,rangingfromuraniumproductiontothedisposalofradioactivewaste.

Nuclear plant safety thepropertyofanuclearpowerplanttoensure,withinthespecifiedlimits,theradiologicalsafetyofthepersonnel,thepublic,andtheenvironmentduringnormaloperationandintheeventofanaccident.

Nuclear power abranchofpowerengineeringthatusesatomicenergyforelectricityandheatgeneration.

Nuclear safety ageneral termthatdescribes thepropertiesofanuclear facility tokeep theradiologicalimpactonthepersonnel,thepublic,andtheenvironmentwithinpermissiblelimitsduringnormaloperationandintheeventofanaccident.

Operator anorganisationthatpossessestheregulatorpermittooperateanuclearplantoranothernuclearfacility.

Organisational business model a model including the key business processes and the resources (capitals) employed,throughtheuseofwhichtheorganisationcreatesandmaintainsitsvalueoverthelongterm.

Phase Gate thePhaseGateapproachtocarryingoutinvestmentactivities,aprincipleofplanningandcarryingoutinvestmentactivitiesthatsuggests,whenapplied,thatinvestmentprojectsarebrokendownintophases,ofwhicheachisprecededbyaGateReviewoftheresultsachievedandthefurtherprojectimplementationplansandrisk,andadecisionisthenmadeonthefurtherprojectimplementationphasetobeproceededto.

Power start-up astageinthenuclearplantcommissioningduringwhichthenuclearplantstartstogenerateenergy and the nuclear plant operation is checked at different power-up levels to thatspecifiedforcommercialoperations.

Radiation exposure atotalofindividualexposuredosesreceivedorplannedintheoperationstodecommission,maintain, repair, replace, or dismantle components of a nuclear facility, e.g. of a nuclearplant.

Radiation safety asetofarrangementsseekingtolimittheexposureofpersonnelandthepublictothelowestpossibleradiationdosevaluesinasociallyacceptableway,aswellastoavoidearlyeffectsofexposureandkeepthedelayedradiationeffectswithinthetolerablelimits.

Radioactive release atmosphericemissionofradionuclidesastheresultofnuclearplantoperation.

Radioactive waste nuclearmaterialsandradioactivewastesnotsubjecttofurtheruse.


Recommendations of the Russian Union of Industrialists and Entrepreneurs (RUIE) for Use in the Practice of Management and Corporate Non-financial Reporting (key performance indicators)

asystemofeconomic,socialandenvironmentalperformanceindicatorsfornon-financialreports, as developed by the RUIE for the purpose of contributing to the introduction ofresponsiblebusinessprinciples.Itisbasedonanumberofunderlyingdocumentsdevelopedby the UN structures (including the UN Global Compact), the Global Reporting Initiative,as well as methodological and procedural recommendations of the Russian Federation’sFederal State Statistics Service and guidance of the RUIE (Social Charter of RussianBusiness, Recommendations on the Preparation of Non-financial Reports “Five StepsTowardstheSocialSustainabilityofCompanies”andothers).

Research reactor anuclearreactordesignedforuseasasubjectofresearchforthepurposeofobtainingdataonreactorphysicsandtechnology,whichisrequiredforthedesignanddevelopmentofareactorofthesametypeorofcomponentsthereof.

Separative work unit (SWU) ameasureoftheeffortsappliedtoseparatethegivenquantityofamaterialofacertainisotopiccompositionintotwofractionswithdifferentisotopiccompositions;itdoesnotdependontheseparationprocessused;akilogramisaseparativeworkunit,andtheenrichmentandenergyconsumptioncostiscalculatedperkilooftheseparativeworkperformed.

Stakeholders physicaland/or legalpersons,aswellasgroupsofpersons,whichhaveaneffecton theorganisation’s activities through their actions and/or are subjected to effects from theorganisation. An organisation may have different stakeholders (public and internationalsupervisingauthorities,shareholders,consumersofgoodsandservices,businesspartners,suppliersandcontractors,civilsocietyorganisations,localcommunities,tradeunions,andothers)withbothmutuallyremoteandconflictinginterests.

Sustainability Reporting Guidelines (Global Reporting Initiative, GRI)

The Sustainability Reporting Guidelines containing the guidelines that define the contentand ensure the quality of reporting information, standard disclosures comprising theperformanceindicatorsoftheorganisation’seconomic,environmentalandsocialimpacts,approaches to the management of said impacts, and other characteristics, as well asrecommendationsonspecifictechnicalaspectsofreporting.

Sustainable development thedevelopment thatcovers thepresent-dayneeds,whilenotendangeringthecapabilityof future generations to cover their own needs. In this connection, the organisation’stransparency and accountability, with respect to its economic, environmental, and socialimpacts,arethefundamentalrequirementsapplicabletoeveryeconomicentity.

Uranium conversion achemicalengineeringprocessoftransforminguranium-containingmaterialsintouraniumhexafluoride.

Uranium hexafluoride achemicalcompoundofuraniumandfluorine(UF6).Thisistheonlyhighlyvolatileuraniumcompound(whenheatedto53°C,uraniumhexafluoridepassesdirectlyfromsolidintogas)andisusedasfeedstockfortheseparationofuranium-238anduranium-235isotopesusingagas-diffusiontechnologyoragas-centrifugetechnology,andfortheproductionofenricheduranium.

Uranium ore enrichment a combination of processes for the primary treatment of uranium-bearing mineral rawmaterialtoseparateuraniumfromothermineralscontainedintheore.Thisdoesnotinvolveanychangesinthecontentofminerals,butratheronlyamechanicalseparationthereofwiththeresultantproductionofanoreconcentrate.

VVER awater-cooledwater-moderatedpowerreactor,inwhichwaterisusedbothasthecoolantandthemoderator.ThemostcommontypeofRussianNPPreactorshastwomodifications:VVER-440andVVER-1000.

Feedbackform

Dearreaders!

You have read the public annual report of JSC Atomenergoprom, which is intended for a broad range ofstakeholders.Theopinionofthereaders,forwhomthereportwasprepared,isveryimportanttous.WewillbeverygratefulifyoucanmakeacontributiontoimprovethequalityoftheCompany’sreportsinthefuturebyansweringthequestionsbelow.

The completed form may be mailed to the Communications Department or to the Treasury at: 24 BolshayaOrdynka Str., Moscow 119017, Russia, or emailed to Mamiy, Ekaterina Abrekovna, Executive Secretary, PublicReportingCommittee,at([email protected]).

1.Ratethereportusingthefollowingcriteria:

Confidence and objectivity level

Excellent Good Satisfactory Unsatisfactory

Completeness and relevance of information


Structure of the report, ease of reference of the information needed, wording


2.Indicatethereportsection(s)thatyouhavefoundtobesignificantorusefulinthespacebelow:

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3.Whatsubjectsdoyouthinkneedtobecoveredinthenextreport?

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4.Yourrecommendationsoradditionalcomments:

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5.Indicatewhichstakeholdercategoryyoubelongto:

EmployeeofJSCAtomenergopromorRosatomStateCorporation

Representativeofaclient/consumerofgoodsandservices

EmployeeofanorganisationwithinJSCAtomenergopromorRosatomStateCorporation

Businessrepresentative

Representativeoffederalpowerbodies Representativeofapublicorganisation

Representativeofregionalpowerbodies Representativeofmassmedia

Representativeoflocalself-governmentbodies Representativeofexpertcommunity

Representativeofcontractor/supplierorganisation Other(state)

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Contactdetails

Joint-StockCompanyNuclearPowerGenerationComplex(Atomenergoprom)24BolshayaOrdynkaStr.,Moscow119017,RussiaTel:+7495969-29-39Corporatewebsite:http://www.atomenergoprom.ru/

TreasuryDanilova,IrinaIgorevna,DeputyDirectorTel:+7499949-29-79Kareva,ViktoriyaOlegovna,ChiefSpecialistTel:+7499949-20-77

CommunicationsDepartmentNovikov,SergeyGennadiyevich,DirectorofDepartmentTel:+7499949-44-12Golovachev,SergeySergeyevich,LeaderoftheProject“DevelopmentofthePublicReportingSystemforRosatomStateCorporationanditsOrganisations”Tel:+7499949-22-45



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