Alexei Likhachev briefed the President on the corporation’s performance.
President of Russia Vladimir Putin: Mr Likhachev,
This year, in December it will be 15 years since the signing of the law on the establishment of the Rosatom corporation. A great deal of work has been accomplished over this period.
Director General of the State Atomic Energy Corporation Rosatom Alexei Likhachev: Yes. The date of the establishment of the corporation is very memorable to us.
Actually, the industry is in its 77th year. We are the same age as the Great Victory albeit the formation of the state corporation signified a completely new stage in the development of the industry. In fact, a group of companies acquired a uniform mechanism of management with common economic indicators and a unique corporate culture. Nuclear competences were unified – from producing uranium to building and operating nuclear power plants. Of course, new divisions were built from scratch: machine-building, logistics, digital and many others.
As for the corporation’s performance indicators over these 15 years, it made what can only be described as a “quantum leap”: its revenue has grown 4.5 times over, labour productivity is five times higher than it was and annual investment is 15 times more than before. The latter is particularly remarkable. We are actively developing science and research and the number of patents has increased 13 times over every year.
Over the past five years, we have actively developed new products and entered the world market. Our revenue from new products has actually doubled and our foreign proceeds rose by 50 percent.
Vladimir Putin: The main task is to increase labour productivity.
Alexei Likhachev: We are developing labour productivity at priority rates. It is growing faster than wages and salaries, which is very important.
Our digital revenues have gone up a hundred times. This is, of course, because of a low starting point. We will certainly continue to develop further.
We have set many records over the last year. Given the full implementation of the state defence order, our revenues reached 1.5 trillion, and this is only the open part. Naturally, our proceeds are much more. Another record is 222 billion kilowatt-hours of electricity. We put new units into operation – the second Leningrad and the first Belarusian units. The company also set a record in terms of shipments along the Northern Sea Route – almost 35 million tonnes.
We are fulfilling the decisions approved at the meeting on the Northern Sea Route that you chaired. Under the guidance of the Government, we have made progress in the construction of nuclear-powered icebreakers, of an ATO [atomic technological maintenance] ship, in creating an integrated navigation management system for the Northern Sea Route. I hope we will be able to launch this system very soon.
We have recorded some serious growth in the first quarter: we generated 2 percent more electricity; proceeds from selling new products are up 26 percent, and up 13 percent for foreign ones.
On the other hand, we understand that we have been living and working under new conditions over the past few months, and that this will continue. I would therefore like to focus on several things.
Vladimir Putin: Please.
Alexei Likhachev: Regarding our international projects, we continue to implement all of them, and everything is proceeding according to plan so far. We see some risks with certain projects, and we are drafting the relevant compensatory measures. I believe we will successfully complete the majority of these projects.
In the past few years, we have been ranked second in terms of global uranium production. We confidently lead the way in terms of enrichment and conversion, and we consistently rank among the three largest fuel manufacturers. We have drafted long-term development projects in all areas.
We continue to cooperate with the IAEA, and we are involved in the ambitious International Thermonuclear Experimental Reactor (ITER) project in France. I want to say once again that the international nuclear community is not yet cutting ties in this sphere, and that this cooperation continues.
Regarding the domestic agenda, apart from state defence contracts, the nuclear power industry remains our top priority. We have built 11 units in ten years; nuclear power plants generate 20 percent of all electricity nationwide. You have instructed us to increase this share to 25 percent, and we will have to build 16 more innovative units, through to 2035, to achieve this goal. The Government has approved a general plan, so we understand what facilities we should build and where.
I would also like to thank you on behalf of the industry for signing, on April 14, the executive order extending our national project until 2030. This is indeed a very serious decision that will create a fourth-generation technological platform for nuclear energy, and most importantly, will give us the opportunity to build a major facility on earth. I am referring to the Proryv (Breakthrough) project in Seversk, a multi-purpose fast research reactor facility, a Tokamak thermonuclear device with reactor technologies, a prototype of tomorrow’s thermonuclear reaction, a number of experimental reactors, and of course our cooperation with Roscosmos, including new rocket engines for near space, and for deep space. All of the above will be included in the extended national project.
Importantly, 95 percent of Russian nuclear power plants are made in Russia, as they say, and the remaining five percent are not critical. We see what’s critical. Electrical engineering, electronics, certain types of diesel equipment, some types of pumping equipment each account for about a half a percent of its value. Actually, we are already creating import substitution alliances with businesses.
So my first point is Russian nuclear technology is import-independent. And we don’t see any problems here.
Second, we will be placing at least one trillion rubles worth of orders outside the industry for implementing our national project every year. This is certainly a very important growth vector for Russian engineering as well as the economy as a whole. But large orders are not all; the nuclear industry has always been known for its advanced technologies and innovation.
Vladimir Putin: Exactly.
Alexei Likhachev: I remember well how in Soviet times, even with the Iron Curtain, mathematical modelling was advancing, and security system projects, too – that gave an impetus to the creation of an entire programme of new products.
I was actually surprised to find out that, over the past year, we have met the demand of more than 2,600 Russian companies and enterprises for high-tech products, that is, Russian industry is already returning our efforts as new innovative orders and projects.
I would like to share with you the ideas that I consider most important. If you recall, at the same meeting on the Arctic, NOVATEK executives raised the issue of LNG equipment. We built Europe’s first test stand at Yefremov NIIEFA in St Petersburg. We designed and implemented a technical solution for cryogenic heat exchangers. This is the basis of any liquefying technology. We have learned to produce medium-scale facilities. I believe we will learn to make large-scale facilities as well.
We are receiving many inquiries from the oil-and-gas industry both as regards specific equipment and in general about new approaches to technology, including the production of difficult-to-access hydrocarbons. We are working on this and maintain exemplary cooperation with Gazprom Neft.
We have fully closed the chain in composites and are converting to the production of specific and quite modern medical equipment.
Vladimir Putin: You helped many companies with composites at once.
Alexei Likhachev: Yes.
We are moving forward in digital development and creating alliances with companies, small companies, private companies, majors like Rostec and Russian Railways.
We will fulfil your instructions two years ahead of schedule: in 2023, software purchases for critical infrastructure will reach 100 percent. We will do this and in general, we are transferring it to Russian software at a faster pace.
We have made progress in quantum technology. We have worked on this for two years. According to expert analysis, we have actually cut the lag time behind our foreign partners’ – our rivals in some cases – developments in half. But in reality, we are now in the top three for some technologies. There is an opinion that a separate type of quanta – qudits – are the best for these processors. Like the United States and Austria, we have now developed a prototype of a quantum processor. Incidentally, we were the first to develop software for this quantum algorithm in the interests of the atomic industry.
I would be remiss if I don’t mention the environmental project, which also represents a series of your instructions.
An industrial waste control system for I and II hazard class wastes has been launched with over 25,000 users. Seven waste treatment plants are being built across the Russian Federation, and I am certain that we will bring things up to code in this area.
Also, we are dealing with heritage. Last September, in Chelyabinsk, we finished working on the household waste dump. In Krasny Bor, we started the actual work. We have completed the necessary priority work in Usolye-Sibirskoye and at the Baikal Pulp and Paper Mill.
Vladimir Putin: What did you do in Usolye-Sibirskoye?
Alexei Likhachev: We completely tore down the mercury electrolysis shop and cleaned up the area. We started working with the oil lens where there was a risk of waste going straight into the Angara River. We have fully completed the project design in order to begin full-scale system-wide liquidation this year. There were scores of extremely dangerous wells, and no one knew what was stored there or how much. So, neutralising and blocking them were among our priorities as well.
In closing, I would like to say a few words about the team. Indeed, we are more than a technology leader or a global nuclear industry leader. We are a unique team with our own traditions. We are first in employer rankings. Full involvement and employees’ willingness to devote themselves to their work is an important indicator and stands at 84 percent, a level that exceeds top international indicators. I would like to add that this number went up in recent weeks. That is, our employees have rolled up their sleeves and got down to work seeing this as their contribution to fulfilling the country’s immediate goals.
Vladimir Putin: Rosatom is definitely among our technology leaders. I hope this trend continues.
We talked about materials. You have helped many industries, from aircraft manufacturing to medicine.
Alexei Likhachev: Mr President, machine building is our main focus. We have reinforced our machine-building capacities, and we have many orders.
One more thought. The more pressure they put on us, the more work we have, and the more the team is mobilised.