Errol Musk on TAIF Group: “I immediately realized, these are serious guys”

“Our goal is to turn 1,000 kg of oil into 970 kg of gasoline and diesel”

The meeting, initiated by Errol Musk, was organized promptly and was very lively. TAIF was represented by CEO of TAIF JSC Timur Shigabutdinov and Deputy Chairman of the Board of Directors of TAIF JSC Ruslan Shigabutdinov. The elder Musk was genuinely interested in oil refining issues, prospects for oil production, and generation possibilities.

Timur Shigabutdinov spoke in detail about TAIF, the largest fully private company in the Republic of Tatarstan, established 35 years ago, noting the Group's specialization in investment activities, in addition to its main areas — petrochemicals, oil refining, and energy.

“Over 35 years, TAIF has invested more than $20 billion. Throughout the company's existence, over $95 billion in loans for development have been raised. Of these, we have already repaid 93," he said.

Special emphasis in the conversation was placed on petrochemicals. Timur Shigabutdinov spoke about the operations of several large enterprises — Kazanorgsintez and Nizhnekamskneftekhim, located in Tatarstan. “Four years ago, we completed a merger deal with the largest Russian company, SIBUR, which is among the top five petrochemical companies in the world," he noted. “We also operate in oil refining, where we are developing a unique deep oil refining technology.”

The discussion about oil refining and new technologies interested Musk. “This technology allows us to obtain 97.5% light petroleum products — a unique technology," noted the CEO of TAIF. “Similar technologies exist in the world, but this one is unique to us. Its special feature is its ability to process heavy oil as well. Our goal is to turn 1,000 kg of oil into 970 kg of gasoline and diesel. We spent a lot of time and effort bringing this technology to industrial scale, and we are proud that this technology exists and works. We are bringing it to its design parameters and will replicate it further.”

— Currently, the global average yield of light petroleum products in oil refining is 78–85%, — noted Ruslan Shigabutdinov.

— What are your oil reserves? — asked Errol Musk, clarifying that he meant both average annual production and estimated well reserves in Russia as a whole and in Tatarstan specifically.

“Tatarstan produces about 32 million tons of oil annually," Timur Shigabutdinov replied. “Future reserves are a very interesting situation. According to calculations made 30–40 years ago, oil in Tatarstan should have been depleted, but today Tatarstan's oil reserves are sufficient for more than 50 years, and in fact much more.”

— Throughout the development history of the Romashkino field in Tatarstan, over 3 billion tons of oil have been extracted, — added Ruslan Shigabutdinov.

— We hope that with the improvement of extraction technologies, including for heavy oils, reserves will naturally increase every year, — commented Timur Shigabutdinov.

— Regarding Russia, about 520 million tons are produced per year, and it is forecast that over the next hundred years, reserves will be maintained at the same level as now. But this is not an expert opinion — we are oil refiners, — explained the CEO of TAIF JSC.

— We are one of the few companies in Russia that buys raw materials at market prices and sells products at market prices. We do not have our own oil production, — added Ruslan Shigabutdinov.

— Yes, I understand, but what you're telling me is very interesting, — noted Errol Musk.

Errol Musk was very impressed by Tatarstan, and he was interested in the development of one of Russia's central regions for oil refining and petrochemicals. “Various types of organic chemicals and plastics alone are produced here at over 4 million tons per year — precisely by SIBUR," Timur Shigabutdinov answered his questions.

— Dmitry Mendeleev, who created the periodic table, came up with it in Tatarstan, — Ruslan Shigabutdinov impressed the guest. — At one time, we were shareholders of that plant (the Karpov Chemical Plant, where the Russian chemist D.I. Mendeleev worked in the late 19th century — editor's note).

At least a gigawatt for data centers and mining

From petrochemicals, the conversation moved to generation. “We are the owners of TGC-16, which consists of two combined heat and power plants (CHPPs), energy generating facilities. Two gas-powered stations with a total capacity of 1.6 gigawatts. We constantly invest funds and build additional capacity. A program is being developed for the next 6 years to build additional capacity — up to 2 gigawatts," said Timur Shigabutdinov.

The CEO of TAIF noted that there are currently certain obstacles, adding, “which we will definitely overcome.”

— General Electric supplied us with the only H-class gas turbine in Russia, with a capacity of 405 megawatts. This is the most modern class. At the opening and launch of this turbine, we had the honor of hosting the US Ambassador to Russia, Mr. Huntsman, — he continued. — Why did I bring up this topic: with the further development of generation and the overall grid of Tatarstan and Russia as a whole, we are considering the possibility of allocating part of the capacity for data centers and mining systems.

— The demand in these areas will be great in the future, — Errol Musk supported the idea.

— We understand that these are global trends. Energy issues will become more and more pressing every year. Anticipating this situation, we have already started working on projects both in generation and in the area of data centers. Several stages are planned: the first phase is 500 megawatts for data centers and mining, and subsequently another 500. In total, we will direct at least a gigawatt to this area. We have experience, competencies, and knowledge specifically in generation. We are considering investment projects for the construction of data centers in various configurations for corporate infrastructure.

Errol Musk supported this discussion with interest, offering his suggestions: “In Russia, you definitely need to do a mix — both cloud services and farms...”

— Our competencies lie in design, construction, and operation. TAIF's stations rank 2nd in the country in terms of efficiency based on the grams of fuel per kilowatt metric, — Ruslan Shigabutdinov told Musk.

Errol Musk expressed interest in continuing the discussion: “The reason I'm telling you all this here is because you are very smart, developed guys.”

“You are so much on the right track that I wouldn't change a thing”

After the meeting, Errol Musk answered a few questions from Realnoe Vremya and shared his impressions of his stay in Russia:

— What goals did you have when coming to Tatarstan, and were you able to achieve the planned results of this trip?

— This was a getting-acquainted visit. I became friends with Arsen (founder of Tatarstan's first IT Park, Arsen Khusnutdinov — editor's note), and he told me: “If you're going to Russia, I want to take you to the most modern city in the world. Isn't that great?” I asked: “What city is that?” He replied: “Kazan. And if you go there, your perception will change forever.” Yes, yes. And he said: “Don't believe my words until you see it for yourself.” So we came to this ultra-modern city, which you should be immensely proud of. What an incredible place it is. It's a big surprise; I didn't expect to see such a thing. I've seen cities where time seems frozen in the 70s, life is in the past. When American cities started developing, they were somewhat like Kazan. But Kazan is truly something special.

I met with students; I believe a couple of thousand came. They are the best examples of what you would want to see among young people, especially in today's world. In the West, there are many spoiled people, you know, who behave badly. In Kazan, I didn't see any strange kids with tattoos; I only saw perfect children. Several thousand people came, absolutely bright, intellectually developed, with great interest in life, science, and technology. Am I right?

— You had several meetings in Kazan; were any specific agreements reached as a result?

— Until today, we only discussed general things. A very specific conversation took place at the Academy of Sciences with Rifkat Nurganievich and his team. And now, it seems, we have stumbled upon a gold mine: we had a really good meeting at TAIF. As soon as I arrived, I immediately realized — these are serious guys. And during the meeting, frankly, I looked at them (Timur and Ruslan Shigabutdinov — editor's note) and thought, what great guys. The negotiations were successful.

— What are your further plans in Russia; which other cities would you like to visit?

— I think there's still plenty to see here (laughs). I would like to travel further, to those places I've read about — the Caspian Sea, the Caucasus, the Urals. I want to see that city where it's so cold that you throw boiling water into the air, and it instantly freezes. Murmansk, I think. Somewhere around there. But not on this trip.

— What would you wish for the guys from Tatarstan; what words of advice would you give?

— Honestly, I would say that you are so much on the right track that I wouldn't change a thing. Just continue in the same spirit. There's no need to say anything additional to the guys I saw. They are doing everything right.