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Q1 2014 IFRS results – Rosneft Oil Company

Rosneft Oil Company · Apr 30, 2014 · 41 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Q1 2014 IFRS results – Rosneft Oil Company – slide 1
    OJSC Rosneft Q1 2014 IFRS results April 30, 2014 30.04.2014
  2. Q1 2014 IFRS results – Rosneft Oil Company – slide 2
    Q114: Key Highlights Free cash flow growth and debt reduction Change Indicator Value Causes QoQ Growth of crude oil and petroleum product prices in Revenue, RUB bln 1,375 +1.9% rubles, changes in export mix Control of operating…
  3. Q1 2014 IFRS results – Rosneft Oil Company – slide 3
    Q114: Key Highlights Greenfield p production growth g with cost control Change Indicator Value Causes YoY Hydrocarbon production, 5.1 +5.1% mmboed Liquids production, 42 4.2 +0 5% +0.5% Production growth at Vankor Vankor,…
  4. Q1 2014 IFRS results – Rosneft Oil Company – slide 4
    Market Environment: Price decline and growing RUB volatility Crude oil prices and exchange rate(1) Petroleum product prices(2) /bbl RUB/ /t 130 22 1 200 1,200 Brent Urals ESPO Exchange rate 120 25 1,000 110 28 800 100 31…
  5. Q1 2014 IFRS results – Rosneft Oil Company – slide 5
    Financial results 6
  6. Q1 2014 IFRS results – Rosneft Oil Company – slide 6
    EBITDA: Growth through costs structure optimization RUB bln Macro factors: +RUB 14 bln; +5% Company controlled factors: (2) +RUB 2 bln; +1% (11) (9) 47 (5) (6) 3 (13) 12 289 273 Q4'13 Exchange Tax Taxation Urals…
  7. Q1 2014 IFRS results – Rosneft Oil Company – slide 7
    Lifting Costs: Maintaining leadership positions in the industry Lifting costs Benchmarking(1) RUB/boe Electricityy Other /boe Peers Rosneft 20 38 34 38 15 38 10 106 104 111 94 5 4.3 3.8 2.8 2.9 0 Q2'13 Q3'13…
  8. Q1 2014 IFRS results – Rosneft Oil Company – slide 8
    CAPEX: Discipline in major projects implementation CAPEX dynamics RUB bln Decline in Q114 vs. Q413 due to seasonality of work 182 Key priorities: 153 130 Sustain brownfield production (over Q113 Q114 RUB 268 bln; of this, RUB…
  9. Q1 2014 IFRS results – Rosneft Oil Company – slide 9
    Free Cash Flow: Sustainable level underpinned by improving operating efficiency Free cash flow(1) Benchmarking(2) RUB bln /boe Peers Rosneft 25 11 15 15 7 5 7.7 39 31 3.1 35 3.5 121 1.5 -5 49 -15 Q4'13…
  10. Q1 2014 IFRS results – Rosneft Oil Company – slide 10
    Improved Efficiency and Cost Reduction: Procurement optimization, internal benchmarking Prices for the services of several third-party contracts reduced by 1-6% (oilfield services, services fracking and workovers, workovers wells…
  11. Q1 2014 IFRS results – Rosneft Oil Company – slide 11
    Synergies: Q114 results RUB bln CAPEX 26 2.6 23 1 23.1 Operating efficiency 1.8 1.1 3.6 1.7 11.7 0.4 U t Upstream R fi i Refining G projects Gas j t Commerce and C d HR M t i l supportt Material O Operating ti…
  12. Q1 2014 IFRS results – Rosneft Oil Company – slide 12
    Drilling Service Optimization: Key performance improvement element Drilling commercial speed Production drilling Current situation in the drilling and OFS market: (Priobskoe field) structure High concentration (in 2013 50% of…
  13. Q1 2014 IFRS results – Rosneft Oil Company – slide 13
    Asset Portfolio Development: Improving p g integrated g business performance p Transaction description Strategic rationale 6 licenses obtained for field development and 5 Support production level for geological…
  14. Q1 2014 IFRS results – Rosneft Oil Company – slide 14
    Improving Financial Sustainability: Efficient management of debt portfolio Net debt Repayment schedule(2) RUB bln RUB bln 1,909 1,860 1,586 891 649 470 301 294 Q3'13 Q4'13 Q1'14 Q2-Q4'14 2015 2016 2017 2018 and…
  15. Q1 2014 IFRS results – Rosneft Oil Company – slide 15
    Operating results 16
  16. Q1 2014 IFRS results – Rosneft Oil Company – slide 16
    Crude Production: Stabilization of production at key brownfields Oil production Key achievements in Q114 mbd Successful implementation of key workover solutions: 39.3% 39.5% 39.5% 39.2% Multistage hydrofracs: 2x growth YoY 39.1%…
  17. Q1 2014 IFRS results – Rosneft Oil Company – slide 17
    Crude Production: Production growth drivers in Q114 Greenfield production Key achievements in Q114 mbd Uvat: 781 788 800 763 record commercial speed 1,513 m/day 731 shorter well development cycle (from 19.2 to 11.5 days)…
  18. Q1 2014 IFRS results – Rosneft Oil Company – slide 18
    Crude Production: Continuing efficient reserves development in East Siberia Key features The Company has started infrastructure Field 1+2 oil reserves,, development at the first priority part of including: 350 mmt…
  19. Q1 2014 IFRS results – Rosneft Oil Company – slide 19
    Gas Business: Efficient production growth Key achievements in Q114 Gas production bcm Gas processing and petrochemical agreement with SIBUR: +120 % closed sale of 49% in JV Yugragazpererabotka 12.1 13.2 10.8 signed long-term,…
  20. Q1 2014 IFRS results – Rosneft Oil Company – slide 20
    Key projects: Sibneftegaz Mature gas asset with growth potential Gas MET breaks Beregovoe field (savings in 2014-2018 RUB 4 bln) Key objectives for 2014: Pyreinoe field start infrastructure development at Beregovoe and…
  21. Q1 2014 IFRS results – Rosneft Oil Company – slide 21
    Key projects: Rospan Gas asset that will assure most of production Urengoyskoe field growth over the next 5 years East-Urengoyskoe+ as U e goys oe North-o Esetinskoe field MET breaks for gas and gas condensate (Savings in…
  22. Q1 2014 IFRS results – Rosneft Oil Company – slide 22
    Gas Business: Organic growth is a base for further development Gas share in hydrocarbon reserves and production Target for 2020 100 bcm bcm Reserves(1) 120 100 Sakhalin and other KChLA 31% 14% Kharampur 80 Rospan…
  23. Q1 2014 IFRS results – Rosneft Oil Company – slide 23
    Refining: High-margin monetization channel Monetization channels in Q114: refining Refinery throughput in Russia Production of motor fuels in Russia 91 9.1 1,678 43% 1,184 5.5 ck, /t 5/t 349 /t 347 /t +64%…
  24. Q1 2014 IFRS results – Rosneft Oil Company – slide 24
    Refineries Modernization: Completion status Vacuum Isomerizati Cat Hydro- Hydrocrack Reforming Alkylation Coking(1) MTBE block on cracking treatment ing Ryazan Angarsk Novokuibyshevsk Syzran Kuibyshev Komsomolsk…
  25. Q1 2014 IFRS results – Rosneft Oil Company – slide 25
    Trading in Crude Oil and Petroleum Products: Growth in premium channels Monetization channels in Q114: exports Crude export mix Exchange-based trading on Russian domestic market 344 /t 347 /t +38% 0.4 17.4% 24.9% 10% Nettback,…
  26. Q1 2014 IFRS results – Rosneft Oil Company – slide 26
    Retail Operations: Improving fuel quality and class of service Key achievements in Q114 Retail sales via own network, t/day Retail margin grew to 5,200 RUB/t Premium 26.7 segment Aver. throughput per filling station Share 11%…
  27. Q1 2014 IFRS results – Rosneft Oil Company – slide 27
    Premium Channels Expansion: 2 Key achievements in Q114 Sustainable development of B2B mln t 2.1 Share of into-plane sales of jet fuel up to 69% Storage cards opened in Ramenskoe and Chita +134% 0.7 airports 1.3 +37% Started…
  28. Q1 2014 IFRS results – Rosneft Oil Company – slide 28
    Key Priorities for 2014 Growing efficiency at sustained CAPEX levels P Gradual deleveraging % Stabilizing production at key assets in West Siberia Optimizing drilling business structure and development of in-house in house…
  29. Q1 2014 IFRS results – Rosneft Oil Company – slide 29
    Appendix 30
  30. Q1 2014 IFRS results – Rosneft Oil Company – slide 30
    Q1 2014 Financial Results ( mln)) Item name Q114(1) Q413(1) Revenue 39.3 41.5 (5.3)% EBITDA 8.3 8.4 (1.2)% Net income 2.5 4.1 (39.0)% Operating cash flow(2) 18.8 11.6 62.1% CAPEX 3.0 5.6 (46.4)% Free cash flow(3) 15.8…
  31. Q1 2014 IFRS results – Rosneft Oil Company – slide 31
    RN-Holding: Results of the Voluntary Buyout 67 On November 6, 2013, OJSC RN Holding received a voluntaryy tender offer from Rosneft in respect p of: RUB 1,918,701,184 ordinary shares offer price per ordinary share 450,000,000…
  32. Q1 2014 IFRS results – Rosneft Oil Company – slide 32
    Management Ownership of Rosneft Shares Number of common Stake in share capital, Members of the Board of Directors and Management Board shares % I Igor S hi Sechin 13 489 350 13,489,350 0 1273 0.1273 Larisa Kalanda 2,171,818 0.0205…
  33. Q1 2014 IFRS results – Rosneft Oil Company – slide 33
    Revenue Crude oil and gas sales Petroleum product sales 2.4% 44.1% 5.6% 4.0% 56.6% 4.5% 4.6% 3 7% 3.7% 729 632 RUB bln RUB bln 13.8% 29.6% 9 6% 17 5% 17.5% 13 6% 13.6% Europe and other directions Europe and other…
  34. Q1 2014 IFRS results – Rosneft Oil Company – slide 34
    Non-controlled Expenses th. RUB/t 5.87 6.70 5.75 5.45 5.00 Net export revenue Export duty Yugansk-Novorossiysk tariff 13.66 MET 12.36 12 56 12.56 12 99 12.99 12.01 78% 1.59 1.59 1.59 1.59 1.59 5.26 5.63 5.47 6.08…
  35. Q1 2014 IFRS results – Rosneft Oil Company – slide 35
    Tax Maneuver Effect Tax maneuver effect in Q114(1),(2) Key changes RUB bln It Item B f Before Aft After 1 1 1 Crude oil MET base rate, RUB 470 493 (8) 6 Crude oil marginal export duty 60% 59% rate (3) (2) Export duty…
  36. Q1 2014 IFRS results – Rosneft Oil Company – slide 36
    Export Duty Lag Effect RUB bln 17 ((11)) (6) (12) (3) 317 300 300 289 279 273 227 215 145 142 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Normalized EBITDA Actual EBITDA 37
  37. Q1 2014 IFRS results – Rosneft Oil Company – slide 37
    Finance Expenses, RUB bln Q114 Q413 Q313 Q213 1. Interest accrued(1) 22 21 4.8% 19 19 2. Interest paid 23 18 27.8% 22 23 3 Change in interest payables (1-2) 3. (1 2) (1) 3 - (3) (4) 4. Interest capitalized(2) 8 9 (11.1%) 8 9…
  38. Q1 2014 IFRS results – Rosneft Oil Company – slide 38
    FX (loss)/gain RUB bln FX (loss)/gain Exchange rate, end of the period RUB/ 29 30 28 19 20 29 11 10 2 30 0 April May June July August September October November December January February March 31 -10 -6 -6 32 -12 -14 -20…
  39. Q1 2014 IFRS results – Rosneft Oil Company – slide 39
    Net Income RUB bln Macro factors: M f t -67 RUB bln; -50% Company controlled factors: +21 RUB bln; +16% 14 (7) (70) 18 27 (26) 134 (4) 2 88 Q4'13 EBITDA (macro Income tax FX Other income EBITDA DD&A…
  40. Q1 2014 IFRS results – Rosneft Oil Company – slide 40
    Net Debt RUB bln (16) (656) 141 23 106 149 (21) 1,860 1,586 Q4'13 Adj. operating Assets disposal Shares buyout CAPEX and Interests FX loss Other Q1'14 cash flow(1) from RN Holding licenses Note: (1) Operating…
  41. Q1 2014 IFRS results – Rosneft Oil Company – slide 41
    Questions & Answers 42

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