The Main Prerequisites and Outcomes of Co-opetition between Oil Companies on International Market

- the full governmental support and the stable interstate relationships between Russia and China, which already exist;

- the determining of the potential foreign partner (the governmental CNPC seems to be the most reliable oil & gas enterprise being the biggest one with essential investment potential and coopetition-oriented strategy, moreover, Lukoil had certain interaction with CNPC in 2003); CNPC official site. Electronic source: http://www.cnpc.com.cn/ru/els/els_index.shtml (access date: 12.05.2016)

- identifying the possible spheres of common interest.

As for the potential spheres of interest, Lukoil may cooperate with the CNPC in the following directions:

1. the ongoing projects, where Lukoil needs to substitute the existing Western parties for the Asian ones (e.g., Caspian Sea offshore projects),

2. the new projects, where the existence of experienced and reliable party is essential, as CNPC has its own technologies and equipment that can be used instead of the Western prohibited ones; CNPC official site. Electronic source: http://www.cnpc.com.cn/ru/ (access date: 12.05.2016)

3. the retail projects in China and oil and petroleum products supply contracts; the mentioned coopetitive sphere can be of great importance for Lukoil, as it has sold the major part of retail assets in the Western countries because of the unstable political situation and has inevitably lost profits that can be seen from the financial results of the resent years.

From the Lukoil part, the main outcomes of the coopetitive strategy in the described spheres of oil & gas business could be:

- creating the alternative customer market by means of supply contracts as the Chinese market is growing and the consumption of the energy resources will have an up-ward trend during the nearest 10-20 years;

- establishing the retail chain instead of the sold Western one (there are no Russian petroleum stations network in China at the moment, so it could be a good opportunity to be a pioneer on the new market);

- getting new resource base with the help of the CNPC investments (Lukoil is the only Russian oil company that has not yet cut its' investment program, which is a risky strategy in the present circumstances);

- entering new markets with the CNPC's support (CNPC has a lot of ongoing projects in Latin America and Africa, while these regions are not fully covered by Lukoil). Ibid. access date: (12.05.2016)

- expanding the product portfolio (CNPC is actively developing its' petroleum and petrochemical portfolio, which is more various than that of Lukoil).

Additionally, for the Chinese party such coopetitive relations will lead to the beneficial outcomes as well. from the CNPC's part, getting the alternative oil and petroleum products supplier and establishing the competitive spirit on the market (as it was mentioned above, CNPC has the ongoing long-term supply contract with Rosneft) that is substantial in the period of growing demand on the Chinese market,

All in all, the using of coopetitive strategy could help the Lukoil Company to keep the market position during the period of sanctions, to continue developing the joint projects with the support of Asian partners, to receive extra income from the supply contracts, to expand its' product portfolio, and to gain the competitive advantage on the both national and global oil & gas market. Such strategy will inevitably affect the long-term performance of the company in a positive way and will help it to reach the level of the Russian competitors, which have already had the coopetitive interactions all over the world. At the same time, such coopetitive relations are beneficial for the Asian parties as well, because it could help the Asian companies to get an access to resources and to maintain the competitive nature of the industry within the region.

Conclusion

Changes in the global economy led to a transition from the intense competition on the international market to the competitive model of cooperation. Even in theory, more and more widely known researchers of different forms of cooperation indicate the existence of unions on the market not only among non-competing organizations, but also between competitors (e.g. B. Garrett & P. Dyussozh, 2002 and others). The described interaction used to be called “coopetition”.

Such a unique tendency of combining incompatible, cooperation and competition, can be explained by several issues: rapid ongoing globalization, intense rivalry, economic and political instability and increasing technological sophistication. Moreover, taking into account the fact of environmental uncertainty companies are not ready any more to take all the risks alone and to struggle against powerful competitors face-to-face. Even large companies do not always have the necessary resources to implement marketing strategies on their own.

All these processes force companies to create a new strategy for their sustainable development and lead to intensive growth of inter-firm cooperation. According to the statistics, provided by Gnyawali & Park (2009), over 50 per cent of partnerships, alliances and collaborative relationships develops between firms within the same industry or among direct competitors.

The phenomena of coopetition stands for simultaneous cooperation and competition between rivals, based on trust and commitment, and striving to mutual benefit of every party involved.

In today's “hyper-turbulent” business environment market strategy of the oil & gas sector is experiencing certain changes as well. All the issues examined in the paper prove the necessity of establishing the stable long-term coopetitive relations among the international oil & gas companies as the list of positive outcomes is extensive and the effects of coopetitive relations determine the strength of the company's market position. Coming back to the annual ratings of the major global market players, we can conclude that all the biggest companies tend to cooperate both with each other and with smaller competitors, creating the complex global coopetitive network.

The stable inter-firm relations are important not only for the actors, but for the states as well. This can be explained with the mentioned in the work exceptional position of the oil & gas industry in the global economy and in the economic growth of the countries.

In consideration of the foregoing premises, we can state that every player involved affects the creation of the successful coopetitive interaction within the industry and the desired outcomes to be achieved. Therefore, states, governments and international organizations are to create the healthy environment and stable political preconditions for companies' interaction. Otherwise, the negative effects will prevail, like those of the recent political crisis, where there are no winners, but the losers (Western companies suffer from the projects' loss as well as the decrease in energy sources supplies, and the Russian companies experience the lack of foreign investments and the decrease of consumer markets).

As for the companies of the oil & gas industry, they are responsible for sustainable cooperation within the coopetitive relations. That means that the companies are to ensure the existence of the three features of coopetitive interaction, covered in the first chapter of the given work. In other words, the companies willing to interact should define the area of mutual benefit, while composing the drafts of the cooperative documents. Additionally, they should establish the trustful relations with their competitors, which are viewed as the most complex part of the coopetitive interaction. However, the long-term relations that are common for the oil & gas sector facilitates much the mentioned task. The last factor to be achieved by the actors is commitment that is directed mostly towards the maintaining of the established coopetitive relations.

All in all, among the main scientific and practical results, evaluated in the course of the given investigations, the following could be mentioned:

1. the phenomena of coopetition is considered to be an essential innovative managerial strategy on the international oil & gas market;

2. the classifications for coopetitive relations within the given industry are identified;

3. the key prerequisites of specifically oil & gas companies' coopetition are identified, as well as the main possible outcomes are highlighted (both positive and negative);

4. in order to create the structural and clear image of all the preconditions, the types of prerequisites are proposed (macro- and micro-levels' prerequisites);

5. the leading role of the state in the coopetitive processes within the industry is detected;

6. the necessity of using the coopetitive strategy in the modern economy is proven, especially in the most turbulent oil & gas economies (such as the Russian's one);

7. the desired coopetitive behavior of the Russian oil companies is explained and its' possible outcomes are proposed.

The author is far from the assumption that the analysis, provided in the paper, covers all completeness of the coopetitive relations between the companies on the international oil & gas market, as it is characterized with substantial complexity. Nevertheless, the received results allow to ensure that cooperation between competitors represents very widespread, though not advertised phenomena.

In conclusion, we can address to the words of the LinkedIn founder Reid Hoffman: "No one can succeed alone. The only way to do something substantial is to perform it together with the others."

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Appendix

Table 1. The number of coopetition published works (SSCI)

Source: Czakon W., Mucha?Kuњ K., Rogalski M. Coopetition research landscape - a systematic literature review. 1997-2010. // Journal of economics and management. 2014. Vol. 17. P. 127.

Table 3. Revenues: Rosneft, 2011-2013

Source: Rosneft Annual report of 2013. URL: www.rosneft.ru (access date: 01.05.2016)

Table 4. Revenues: Rosneft, 2014 - first half, 2015

Source: Rosneft official site. URL: www.rosneft.ru (access date: 01.05.2016)

Table 5. Top 10 oil-exporting countries, 2015.

Electronic source: http://www.worldstopexports.com/worlds-top-oil-exports-country/ (access date: 10.05.2016)

Chart 1. Coopetition concept features frequency distribution

Source: Czakon W., Mucha?Kuњ K., Rogalski M. Coopetition research landscape - a systematic literature review. 1997-2010. // Journal of economics and management. 2014. Vol. 17. P. 130.

Chart 2. Ranking of the top 10 oil & gas international companies based on revenue, March, 2015.



Chart 3. Top 10 oil & gas companies worldwide based on market value, March, 2015.

Chart 4. Rating of the top 10 oil & gas international companies based on net income, 2015.

Chart 5. The top gas producing countries, 2014.



Figure 1. The main layers of oil and gaz.

Figure 2. Foreign energy companies operating in Russia

Figure 3. Top 10 oil & gas producing companies, 2014.

Figure 4. The geographical characteristics of the top global oil & gas companies.



Figure 5. Ranking of top countries with the largest oil & gas reserves.

Figure 6. World population, 2015.

Figure 7. Chinese FDI in the USA by the industry, 2000-2012

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