1 Q 2009 US GAAP
Financial and
Operating Results




June 18, 2009
Disclaimer

  This presentation contains forward-looking statements concerning the financial condition, results of
  opera...
Management Participants in Today’s Call

                  Vadim Yakovlev
                  Deputy Chairman of the Managem...
1Q 2009 Highlights
           Macro
   • Brent 19% down Q-o-Q to US$ 44/bbl from US$ 55/bbl and Y-o-Y 54% down
     from U...
Key Macroeconomic Factors

      Crude pricing, RUR/USD Rate (eop) relation                                               ...
Gazprom Neft Financial Results (US$MM)

                                                      (48%)                       ...
1Q09 Factor Analysis
                                                                                                     ...
Financial Performance
Revenues (US$MM)                                       EBITDA (US$MM)                               ...
Operational Performance
Crude output (MM bbl)                                  Crude Oil Export (MM Tonnes)               ...
Consistent Cash Performance
 Cash Sources and Uses (US$MM)                                    Available Net Cash Flow (US$...
Debt Profile
 Net Debt/EBITDA, Gearing (%)                                     Maturity Profile (US$MM)

  0,60           ...
Organic Capex Breakdown
   Capex Dynamics (US$MM)


               $885
                                                  ...
Operating Results




                    13
Upstream
Oil Production (MM Bbl)
         86.6                85.3                   85.3               83.8              ...
Maximizing Netbacks & Enhancing Operational
Efficiency through Oil Flows Distribution
1Q2008 Netback (US$ per bbl)        ...
Downstream
Refining Throughput (MM Tonnes)                                            Oil Products Slate, % (1Q09)        ...
Oil Products Marketing in Russia
Oil Products Sales in Russia (MM Tonnes)


                 4,2           4,5 -22%
    3,...
Outlook




          18
2009 Perspectives – Three aspects to deal with

              Revenues            Opex $ Capex              Financial Situ...
Recent transactions




                      20
Acquisition of Naftna Industrija Srbije AD,
Novi Sad, Serbia (“NIS” AD)

                                                 ...
Sibir Energy Overview


Upstream business
Reserves
  - 120 MM Tonnes (C1 reserves)
  Production
   - 4.8 MM Tonnes in 2009...
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Presentation 1Q09

  1. 1. 1 Q 2009 US GAAP Financial and Operating Results June 18, 2009
  2. 2. Disclaimer This presentation contains forward-looking statements concerning the financial condition, results of operations and businesses of Gazprom Neft and its consolidated subsidiaries. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking statements are statements of future expectations that are based on management’s current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. Forward-looking statements include, among other things, statements concerning the potential exposure of Gazprom Neft to market risks and statements expressing management’s expectations, beliefs, estimates, forecasts, projections and assumptions. These forward-looking statements are identified by their use of terms and phrases such as ‘‘anticipate’’, ‘‘believe’’, ‘‘could’’, ‘‘estimate’’, ‘‘expect’’, ‘‘intend’’, ‘‘may’’, ‘‘plan’’, ‘‘objectives’’, ‘‘outlook’’, ‘‘probably’’, ‘‘project’’, ‘‘will’’, ‘‘seek’’, ‘‘target’’, ‘‘risks’’, ‘‘goals’’, ‘‘should’’ and similar terms and phrases. There are a number of factors that could affect the future operations of Gazprom Neft and could cause those results to differ materially from those expressed in the forward-looking statements included in this presentation, inclusively (without limitation): (a) price fluctuations in crude oil and oil products; (b) changes in demand for the Company’s products; (c) currency fluctuations; (d) drilling and production results; (e) reserve estimates; (f) loss of market and industry competition; (g) environmental and physical risks; (h) risks associated with the identification of suitable potential acquisition properties and targets, and successful negotiation and completion of such transactions; (i) economic and financial market conditions in various countries and regions; (j) political risks, project delay or advancement, approvals and cost estimates; and (k) changes in trading conditions. All forward-looking statements contained in this presentation are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Readers should not place undue reliance on these forward-looking statements. Each forward-looking statement speaks only as of the date of this presentation. Neither Gazprom Neft nor any of its subsidiaries undertake any obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information. 2
  3. 3. Management Participants in Today’s Call Vadim Yakovlev Deputy Chairman of the Management Board and CFO Boris Zilbermints Deputy Chairman of the Management Board, Deputy CEO for Exploration and Production Anatoly Cherner Deputy Chairman of the Management Board, Deputy CEO for Logistics, Processing and Sales Yuri Kalner Head of Strategic Planning Department 3
  4. 4. 1Q 2009 Highlights Macro • Brent 19% down Q-o-Q to US$ 44/bbl from US$ 55/bbl and Y-o-Y 54% down from US$ 97/bbl 1Q 2009 Headline numbers – recovery in progress • Revenue 16% down Q-o-Q; Y-o-Y 47% down • EBITDA up 362% Q-o-Q to US$ 942 MM; Y-o-Y 53% down • Adjusted EBITDA* up 131% Q-o-Q to US$ 945 MM; Y-o-Y 56% down • Net Income Q-o-Q up to US$ 335 MM; Y-o-Y 76% down • Operating Cash Flow Q-o-Q Costs Performance • Operating Costs down 12% Q-o-Q;10% down 10% Y-o-Y • Export Duties Q-o-Q 52% down; Y-o-Y 62% down • Taxes other than Income Tax Q-o-Q 5% up; Y-o-Y 50% down Asset Portfolio Expansion • 51% stake in NIS (February 2009) • 34% stake in Sibir Energy (April-June 2009) • Gazprom Neft Marine Bunker - #2 Bunkering Co in Russia, • Gazprom Neft Avia – presence in 11 airports across Russia • Gazprom Neft Lubricants – Acquisition of Lubricants Plant in Italy (Bari) Adjusted EBITDA includes the Company’s share in its equity affiliates (Slavneft and Tomskneft) EBITDA Source: Company data 4
  5. 5. Key Macroeconomic Factors Crude pricing, RUR/USD Rate (eop) relation Crude Export Profitability ($/bbl) 140 36 Average freight $120 Straits demurrage/port dues, insurance, port handling, customs fees, other Transneft tariff Crude export duty MET Crude export netback less MET in Western Siberia 100 $90 Average crude export netback less MET in Western Siberia since 2001 32 Urals (cif Novorossiysk) $60 60 28 Brent, $/bbl (lhs) $30 RUR/USD rate (rhs) $0 20 24 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-08 Apr-08 Jul-08 Oct-08 Jan-09 Export duties formula amended Current taxation regime* 0 * Effective from January 1, 09 MET threshold price raised from 9 ($30) to $15/bbl • Low crude pricing environment was the major driver for revenue decrease in 1Q09. However sharp taxes cuts were the main reason for profitability recovery in 1Q09 • Pricing fall was partially compensated by drastic Russian Ruble devaluation which dragged costs down, but also had a negative impact on domestic revenues denominated in rubles Source: Platt’s, Federal Statistics Service, Company data, Central Bank of Russia, Argus 5
  6. 6. Gazprom Neft Financial Results (US$MM) (48%) • Oil prices were the core drivers (16%) for revenue decrease in 1Q 2009 $10 085 • Rouble devaluation stressed $9 957 Revenues* $8 045 $4 988 domestic revenues in dollar terms $4 185 1Q08 2Q08 3Q08 4Q08 1Q09 (54%) • Significant Tax Cuts determined +362% Financials recovery in 1Q 2009 $3 093 $2 642 • Costs reduction through Rouble $2 026 EBITDA $942 devaluation $204 1Q08 2Q08 3Q08 4Q08 1Q09 (76%) • Recovery in quarterly financials N/A • Non-cash foreign exchange $2 196 $1 411 $1 594 loss of $166 MM eroded Net Income $335 non-operating income and reduced bottom line profitability in -$543 1Q 2009 1Q08 2Q08 3Q08 4Q08 1Q09 Source: Company data * Revenues for 2-3Q08 were adjusted for excise tax that was previously excluded (2Q08 - $0.3B; 3Q08 - $0.8B) 6
  7. 7. 1Q09 Factor Analysis FCF (US$MM) Revenue Breakdown (%) 397 -643 Gas Sales Other 1% 3% CrudeNon- Products CIS Export Domestic 35% 28% Crude CIS Export 3% Products CIS Export Crude 4% Domestic Products 1% 373 Non- CISExport 24% 99 186 -38 70 FCF 4Q08 Price Fx Tax Export Cost Work. Cap. Other FCF 1Q09 Rate Changes MET Reduction Duty Lag threshold price 231 179 -482 Source: Company data 7
  8. 8. Financial Performance Revenues (US$MM) EBITDA (US$MM) Net Income (US$MM) $8 045 $2 026 $1 411 $4 988 -48% -16% $4 185 -54% -76% $942 $335 +362% $204 4Q08 N/A 1Q09 1Q08 4Q08 1Q09 1Q08 4Q08 1Q09 1Q08 -$543 Adjusted EBITDA* (US$MM) Adjusted EBITDA* per barrel ($/bbl) Adjusted EBITDA* Margin (%) $2 195 $26 27% 23% -4 p.p. -57% -54% +15 p.p. $945 $12 8% +131% +140% $409 $5 4Q08 1Q09 1Q08 4Q08 1Q09 1Q08 4Q08 1Q09 1Q08 *Adjusted EBITDA includes the Company’s share in its equity affiliates (Slavneft and Tomskneft) EBITDA Source: Company data 8
  9. 9. Operational Performance Crude output (MM bbl) Crude Oil Export (MM Tonnes) Crude Oil Export to CIS (MM Tonnes) 83.8 86.6 4,4 80.5 0,9 10,3 10,4 4,1 9,7 17,7 18,0 -11.1% 0,8 17,0 +14.3% 0,7 3,5 +17.1% -6.8% 0,7 -3.9% -7.0% 55,9 53,1 58,2 4Q08 1Q09 1Q08 4Q08 1Q09 1Q08 4Q08 1Q09 1Q08 Own Production NIS Slavneft* Tomskneft* Domestic Oil Products Sales Refining (MM Tonnes) Oil Products Export (MM Tonnes) (MM Tonnes) 7.1 7.5 0,8 6.6 3.5 3.5 3.5 0,9 0,8 3.6 3.6 3.6 0,6 0,6 0,6 1,7 0,4 0,4 1,7 0,8 0,6 1,6 1,1 1,1 1,5 0.0% 0.0% 0.0% 0.0% +5.6% +13.6% 2,8 3,2 3,2 4,5 4,4 4,2 1,8 1,8 1,4 4Q08 1Q09 1Q08 4Q08 1Q09 1Q08 4Q08 1Q09 1Q08 Omsk NIS Yaroslavl Moscow Export CIS Wholesale from refineries Wholesale tank farms Retail * Production figures include 50% of Slavneft and Tomskneft Source: Company data 9
  10. 10. Consistent Cash Performance Cash Sources and Uses (US$MM) Available Net Cash Flow (US$MM) $666 -$480 $417 $427 -$826 $2 075 $514 $491 -$268 $1 658 $1 551 $1 060 $107 $153 $559 2008 Operating Capital Other Debt Net Dividends 1Q09 $480 Cash Flow Expenditures (Investing Change Activities) Sources Uses Operating Cash Flow (US$MM) Operating Activity (excl. Working Capital) Working Capital Capital Expenditures Dividends Debt Received Debt Repaid Investment (NIS) Other 2 147 Cash Increase/Decrease 1 442 +49% • Debt used for refinancing and M&A 1 008 -61% +43% 847 666 • Capex financed by operating cash flow -21% • $1.7B of cash remained at end 1Q09 1Q08 2Q08 3Q08 4Q08 1Q09 Source: Company data 10
  11. 11. Debt Profile Net Debt/EBITDA, Gearing (%) Maturity Profile (US$MM) 0,60 30% 1 372 0,50 0,40 20% 939 0,30 0,20 10% 567 0,10 0,00 0% 221 152 2006 2007 2008 1Q09 2010 2011 2012 2013 2014 Net Debt/EBITDA (lhs) Gearing (rhs) Debt Structure as of March 2009, % Credit Ratings BBB/Baa2 Investment Grade 6% BBB-/Baa3 BB+/Ba1 BB/Ba2 54% 46% BB-/Ba3 94% B+/B1 B/B2 B-/B3 2003 2004 2005 2006 2007 2008 2009 Foreign Currency (USD, Short-term Long-term EUR, RSD) S&P Moodys RUR Net Debt totaled US$ 3,357 Source: Company data 11
  12. 12. Organic Capex Breakdown Capex Dynamics (US$MM) $885 • 1Q09 Capex down 46% 70 Q-o-Q from US $885 MM in $782 23 4Q08 to US $480 MM in 88 20 1Q09 265 254 -46% -39% $480 43 • Total exploration and 72 production accounted for more than 75% of Capex in 181 1Q09 462 485 184 • Nearly 90% of Capex is 4Q08 1Q09 1Q08 RUR denominated Production - Brown Fields Production - Green Fields Refining Marketing & Distribution 4Q08 1Q09 1Q08 Upstream $10.5/bbl $6.9/bbl $10.4/bbl Brown Fields $8.3/bbl $4.6/bbl $8.3/bbl Green Fields $20.0/bbl $13.5/bbl $19.4/bbl Source: Company data 12
  13. 13. Operating Results 13
  14. 14. Upstream Oil Production (MM Bbl) 86.6 85.3 85.3 83.8 80.5 10,4 10,3 10,2 10,3 9,7 18,0 17,8 17,7 17,7 17,0 0,7 58,2 57,2 57,4 55,9 53,1 1Q08 2Q08 3Q08 4Q08 1Q09 Gazprom Neft NIS Slavneft Tomskneft Source: Company data Note: Including our share in equity investees Number of New Wells Launched* 203 162 132 123 122 74,6 65,7 40 51,6 44,3 1Q08 2Q08 3Q08 4Q08 1Q09 Average flow at new wells, Tonnes per day Gazprom Neft Production by Field* 4Q08 1Q09 • NIS – 1% in overall production in 1Q09 Sugmutskoye Sugmutskoye • Organic production decline driven by accelerating rate of depletion at the Others 31,6% 13,1% Others 30,8% 13,9% Sugmutskoye and Sporyshevskoye fields in Western Siberia and their transition to the 3rd level of the production cycle Priobskoye Priobskoye • Priobskoye (+3 580 bbl a day) and Vyngayakhinskoye (+2 565 bbl a day) are 24,6% 23,8% Krapivinskoye Krapivinskoye leaders in terms of extraction growth 3,5% 3,8% Muravlenkovsk Vyngapurovsko Muravlenkovsko • 126* new wells drilled oye 2,4% ye 2,4% Vyngapurovsko Sutorminskoye Sporyshevskoy ye 11,1% Sutorminskoye Sporyshevskoye ye 11,1% • Drilling program cut was due to overall cost cutting programme 7,8% e 5,9% 8,1% (434* M Meters drilled – 60* M Meters – down from the level of 4Q08) 6,0% Source: Company data 14 *Gazprom Neft data not including its share in equity affiliates (Slavneft , Tomskneft) and NIS
  15. 15. Maximizing Netbacks & Enhancing Operational Efficiency through Oil Flows Distribution 1Q2008 Netback (US$ per bbl) 1Q2009 Netback (US$ per bbl) • Refining Netbacks %, volume %, volume Decreased In 1Q 2009 unlike $57,4 the same period of 2008 $50,6 $45,7 $44,4 $43,8 • Refining Cover remained on the same level $24,3 $23,8 $23,0 $22,5 $21,7 • Sales in Russia and export to CIS had insignificant changes 36.3% 21.4% 8.9% 10.5% 22.9% 37.0% 20.8% 8.7% 7.9% 25.7% Omsk MNPZ & Russia & Export Export Omsk MNPZ & Russia & Export Export • Export Sales were limited by refinery YANOS CIS Sales Pipelines Seaports refinery YANOS CIS Sales Pipelines Seaports Transneft export schedule Crude Balance (%) • Netbacks of Export through Seaports do not exceed Refining Netbacks 46% 59% 58% 58% • Rouble devaluation had a negative impact on Refining 54% 42% 42% and Marketing Netbacks 41% 1Q06 1Q07 1Q08 1Q09 Crude Sales (Export & Domestic) Refining & Products Sales (Domestic & Export) Source: Company data 15
  16. 16. Downstream Refining Throughput (MM Tonnes) Oil Products Slate, % (1Q09) Capacity Utilization (1Q09) 7.1 7.6 7.1 7.5 6.6 Other Diesel 1,6 1,9 1,7 ONPZ 1,7 9% 33% 91% 1,6 Lubes 0,6 0,9 0,8 0,9 0,6 1% 0,8 +12% +3% YANOS 88% 4,9 +42% 4,8 Fuel Oil 4,2 +5% 4,5 4,4 22% Gasoline Jet Fuel 28% MNPZ 82% 1Q08 2Q08 3Q08 4Q08 1Q09 7% Omsk NIS Moscow Yaroslavl Source: Company data Source: Company data Source: Company data Refining Conversion Ratio, % (1Q09) 88,3% 86,1% Oil Refining 82,7% 80,9% 78,5% 79,5% 76,1% 72,5% 70,3% 66,5% 65,5% 63,4% • NIS acquisition leads to growth of refining volumes • Depth of refining is one of the highest at Omsk Refinery Nov o- Omsk Volgograd Perm Ufa Ukhta Angara Saratov MNPZ Ry azan Kirishi Yanos • Maximizing netbacks through high Ufimskiy Refinery value added oil products NPZ Source: INFOTEK 16
  17. 17. Oil Products Marketing in Russia Oil Products Sales in Russia (MM Tonnes) 4,2 4,5 -22% 3,5 +7% 3,5 3,5 0% +20% 1Q08 2Q08 3Q08 4Q08 1Q09 Oil Products Distribution Through retail network (MM Tonnes) 0,7 0,8 -13% 0,6 0,6 0% 0,6 +14% +17% Refineries Distribution sites 1Q08 2Q08 3Q08 4Q08 1Q09 Central Asia Retail Number of Active Gas Stations Retail – Most Efficient Downstream Segment 865 876 • Domestic retail market is still underpenetrated 777 782 673 +1% +1% +11% • Retail sales through owned gas stations – most efficient downstream +15% segment 2005 2006 2007 2008 1Q09 • Rebranding of petrol stations is under way • New retail segments – bunkering, aero fueling and lubricant business Source: Company data 17
  18. 18. Outlook 18
  19. 19. 2009 Perspectives – Three aspects to deal with Revenues Opex $ Capex Financial Situation • Lower tax burden •Strong cash flow •Upstream impacted by generation levels allow oil prices • $230 M saving plan to continue with our - natural monopoly investment commitments tariffs optimization •Ruble devaluation is a - reducing prices of constraint for domestic materials and services revenues - cutting administrative and headcount expenses •Goal to maintain a comfortable financial •Contracts renegotiation position •Refining margins are to (decrease in contractor improve prices by 10-30%) • Prioritizing Capital expenditures * Source: Company data 19
  20. 20. Recent transactions 20
  21. 21. Acquisition of Naftna Industrija Srbije AD, Novi Sad, Serbia (“NIS” AD) Achieved Results • On February 3, 2009 Gazprom Neft completed the acquisition of 51% of shares in Serbia’s NIS • Acquisition properties: • Purchase price of NIS A.D. - Euro 400 million • Financing an investment program (reconstruction and modernization) - Euro 547 million • NIS A.D. is a vertically integrated oil company specializing in exploration and production of crude oil and natural gas as well as processing and marketing of crude oil and oil products • Increased refining capacity – Capacity of NIS A.D. Refineries (Pancevo and Novi Sad) is 7.2 MM Tonnes per annum • Increased resource base – NIS oil reserves (ABC1) amount to 142.2 MM Tonnes, 52.2 MM Tonnes of which are recoverable – In 2008, oil production equalled to 0.6 MM Tonnes • A leading supplier of oil products in the Serbian market, the company produces about 85% of domestically consumed oil products – NIS has its own distribution chain of 485 gas stations and oil tank farms Source: Company data 21
  22. 22. Sibir Energy Overview Upstream business Reserves - 120 MM Tonnes (C1 reserves) Production - 4.8 MM Tonnes in 2009E Downstream business Moscow Refinery (joint venture with Gazprom Neft ) - 10 MM Tonnes of refining throughput (capacity 12 MM Tonnes ) - 133 filling stations - One of the leading position in Moscow and Moscow region market of oil products Source: Company data, Public sources 22
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