Bashneft has released its preliminary operating results for the second quarter of 2014

Average daily production reached a 20-year high of 48.1 thousand tonnes

Production growth rate at brownfields increased to 2.6%

A new asset in Western Siberia, LLC Burneftegaz, accounted for 3.8% of production

88.8% of gasoline output met the Euro 5 standard

Bashneft achieved a considerable increase in the output of niche light products jet fuel and marine fuel

In the second quarter of 2014, oil production at the Company’s fields totalled 4,374 thousand tonnes, which is 11.5% higher than during the second quarter of 2013. In the second quarter of 2014, average daily production reached a 20-year high of 48.1 thousand tonnes per day. During the six months of 2014, Bashneft produced 8,489 thousand tonnes of oil, which is 9.3% more than in the same period in 2013.

Strong growth of oil production in the second quarter of 2014 was driven by a 2.6% increase in production at brownfields due to efficient geological and engineering operations, and by the fact that the Company produced 185 thousand tonnes of oil at the Trebs and. Titov fields in the Nenets Autonomous District and 165 thousand tonnes at the Sorovskoye field of Burneftegaz in the Khanty-Mansi Autonomous District.

In the second quarter of 2014, Bashneft’s refining complex processed 5,481 thousand tonnes of oil, which is 3.7% more than in the same period in 2013. Moreover, as a result of the ongoing refinery upgrade programme the share of light products in refined product output was 62.34% in the second quarter of 2014, which is 1.13 basis points higher than during the period from April to June 2013. In the second quarter of 2014, the average refining depth rose by 0.64 basis points year-on-year to 86.64%.

In the first half of 2014, Bashneft’s refining complex processed 10,799 thousand tonnes of hydrocarbons, which is 2.8% more than in the same period in 2013. At the same time, during the first half of 2014, the average refining depth (84.89%) and the average share of light products (60.52%) remained practically unchanged year-on-year.

In the second quarter of 2014, output of commercial products increased by 4% and reached 5,112 thousand tonnes. Output of gasoline grew by 4.4% year-on-year to 1,268 thousand tonnes. The start of pilot operation of a catalytic cracking gasoline hydrotreater enabled the Company to increase the output of Euro 5 gasoline by 36.5% year-on-year in the second quarter of 2014 and by 34.5% year-on-year during the six months of 2014.

In the second quarter of 2014, diesel fuel production increased by 1.8% year-on-year to 1,950 thousand tonnes. Moreover, during the period from April to June 2014, the output of Euro 5 diesel fuel totalled 703 thousand tonnes, which is 26.0% more than in the second quarter of 2013.

Improvement in the petroleum product mix in the second quarter of 2014 reflectst implementation of a strategy aimed at boosting production of niche light products. During the period from April to June 2014, the output of other petroleum products rose by 17.7% year-on-year due to a 77% increase in production of jet fuel to 58 thousand tonnes and a 21-fold increase in the output of marine gasoil to 83 thousand tonnes.

Preliminary operating results for the first half of 2014

Oil production by oil and gas province

* — LLC Bashneft-Dobycha
** — LLC Bashneft-Polyus
*** — LLC Bashneft-Dobycha and LLC Burneftegaz