Bashneft Approved Reports on Submitting Buyback Requests

OREANDA-NEWS. June 25, 2012. The Board of Directors of JSOC Bashneft and the Boards of its subsidiaries to be merged with the Company (OJSC Ufimsky refinery plant, OJSC Novoil, OJSC Ufaneftekhim, OJSC Bashkirnefteprodukt and OJSC Orenburgnefteprodukt) approved the reports on the results of submission of buyback requests by the shareholders.

The shareholders who did not vote or voted against the reorganization were given the right to submit a buyback request. In accordance with the Law on Joint-Stock Companies, the total amount of funds which the Company can use for the buyout of shares from the shareholders cannot exceed 10% of its net asset value. If the total number of shares to be bought back exceeds the number of securities which can be bought out considering this limit, the shares are bought out in proportion to the number of submitted requests.

Alexander Goncharuk, the Chairman of the Board of Directors, emphasized, ‘Buyback of shares at fair market value is a common practice. It is also an additional way of the Group’s profit distribution to all shareholders of Bashneft Group. Together with the dividends of JSOC Bashneft amounting to 99 roubles per share on the recommendation of the Board of Directors, total payments to shareholders for 2011 can exceed 75% of the Group’s net income under IFRS for this period.’

RESULTS OF SUBMISSION OF BUYBACK REQUESTS BY SHAREHOLDERS AS PART OF JSOC BASHNEFT’S REORGANIZATION

*-Buyback ratios were calculated according to the following formula:

R= NAV*10%/((OS*OS price)+(PS*PS price)), where:

NAV*10% is 10% of net asset value as of the date of decision on reorganization; OS is the total number of ordinary shares to be bought back; PS is the total number of preferred shares to be bought back; OS price is the established buyback price of one ordinary share; PS price is the established buyback price of one preferred share. Buyback ratios are calculated to the tenth decimal place. In this press-release they are rounded to three decimal places.

In accordance with legislation, payments for shares to be bought back shall be made within 30 days after the end of submission of requests (June 13, 2012). The shares bought back by the companies will pass into their ownership. These shares do not give the right to vote; they are not taken into consideration during vote counting and no dividends are paid on them.

As has been reported earlier, on March 11, 2012 JSOC Bashneft announced the start of reorganization through legal merger of the mentioned subsidiaries with the Company (conversion of shares) aimed at increasing transparency of operations, improving efficiency, the quality of corporate governance and liquidity of the Company’s securities. On April 26 and 27, 2012, decisions on the reorganization were made at Extraordinary Meetings of Shareholders of all above-mentioned companies.

Consulting services in the course of reorganization are provided to JSOC Bashneft by Ernst & Young, Goldman Sachs (Russia) (financial adviser), Liniya Prava and Legal Capital Partners (legal advisers). Detailed information on JSOC Bashneft’s reorganization can be found on the website www.bashneft.ru in the section Investors & Shareholders.