OREANDA-NEWS. May 8, 2007.  On May 5, 2007 OJSC “Surgutneftegas” held its Annual General Shareholders’ Meeting. Vladimir Bogdanov, Director General, reported on the Company’s business results in 2006. He stated that over the last 10 years the Company doubled its oil production volumes and the number of producing fields as well as significantly expanded its operations and replenished 100% of produced oil. The Company also made progress in its related sectors, including associated gas processing and power generation ones. Moreover, we substantially increased capacity of our refinery and upgraded 25% of our gas stations.

In the reporting year, Surgutneftegas delivered strong key operating results as well as accomplished all the targeted investment projects, programs and business development priorities. The Company increased its oil production rate by 2.7% to 65.6 mn tons, C1 category reserves by approximately 69 mn tons, oil refining by 9.2% to 20.2 mn tons, gas processing by 36% to 5.3 bcm (whereas the capacity of gas processing plant reached 7.2 bcm) and power generation by 30% to 1.9 bn kWh. The commodity turnover of the Company’s sales and marketing divisions grew by 35% to over 1 mn tons.   

In 2006, OJSC “Surgutneftegas” acquired 16 new license areas.
Today, the Company’s resource base includes 110 license areas located in
10 constituent entities of the Russian Federation.

The construction of the largest in Europe deep petroleum hydrocracking complex is still under way. In the year under review, we installed
large-sized production equipment, and now continue to carry out construction and installation works.

Defining the Company’s growth prospects in 2007, Vladimir Bogdanov declared:

“We will continue to implement projects designed to develop
the Company’s core activities. The hydrocarbon production rate is expected to approach 80 mn tons. The commissioning of 3 new fields will boost the Company’s producing capacity.”

The Company is planning to boost gas processing and power generation capacity, as well as to proceed with construction of the hydrocracking complex.

In the current year, the Company’s investment program will amount to
nearly RUR 93 bn”.

When holding, the Annual Shareholders’ General Meeting considered all agenda items:

Regarding “Approval of OJSC “Surgutneftegas” annual report for 2006”, the shareholders resolved “To approve OJSC “Surgutneftegas” annual report for 2006”.

Regarding “Approval of OJSC “Surgutneftegas” annual accounting statements, including profit and loss accounts for 2006”, the shareholders resolved “To approve OJSC “Surgutneftegas” annual accounting statements, including profit and loss accounts for 2006”.

Regarding “Approval of distribution of profit (loss) of
OJSC “Surgutneftegas” for 2006, including dividend payment (declaration), approval of the size, of form, of schedule and procedure of dividend payment on shares of each category”, the shareholders resolved “To approve profit distribution (loss) of OJSC “Surgutneftegas” for 2006 and to declare dividend payment for 2006 at the amount of RUR 0.71 per a preferred share and
RUR 0.53 per an ordinary share. Dividend payment shall be carried out in accordance with the procedure recommended by the Board of Directors. The date when dividend payment is commenced is May 21, 2007. The date when dividend payment is terminated is July 04, 2007”.

Regarding “Election of members of OJSC “Surgutneftegas” Board of Directors”, the shareholders resolved “To elect the following persons to the Board of Directors: Ananiev Sergei Alekseevich, Bogdanov Vladimir Leonidovich, Bulanov Alexander Nikolaevich, Gorbunov Igor Nikolaevich, Druchinin Vladislav Egorovich, Erokhin Vladimir Petrovich, Zakharchenko Nikolai Petrovich, Matveev Nikolai Ivanovich, Rezyapov Alexander Filippovich”.

Regarding “Election of members of OJSC “Surgutneftegas” Auditing Committee”, the shareholders resolved “To elect the following persons to the Auditing Committee of OJSC “Surgutneftegas”: Zhuchko Tatiana Nikolaevna, Komarova Valentina Panteleevna, Oleynik Tamara Fedorovna”.

Regarding “Approval of the Auditor of OJSC “Surgutneftegas”, the shareholders resolved “To approve Limited Liability Company “Rosekspertiza” as the Auditor of OJSC “Surgutneftegas” for 2007”.

Regarding “Approval of transactions with an interested party which may be conducted by OJSC “Surgutneftegas” in the course of general business activity (in compliance with the Federal Law of the RF “On Joint Stock Companies”, Article 83, Item 6), the shareholders resolved “To approve transactions which may be conducted in the future between OJSC “Surgutneftegas” and its affiliated parties in the course of general business activity of OJSC “Surgutneftegas”, provided that the above-mentioned transactions comply with the following requirements: the transaction is aimed at performing the types of activities stipulated by the Charter of OJSC “Surgutneftegas” and the amount of transaction is within the amount of the transaction the individual executive body of OJSC “Surgutneftegas” is entitled to perform in compliance with the Federal Law “On Joint Stock Companies”. The resolution remains valid till
OJSC “Surgutneftegas” Annual General Shareholders’ Meeting for 2007”.