Yesterday, the Board of Directors of JSOC Bashneft took a decision to increase the Company’s authorized share capital through a public offering of up to 37 million additional ordinary shares. The Board of Directors approved the share issue decision and the prospectus, while also giving their approval for a possible inclusion of Bashneft’s shares in Moscow Exchange’s First Tier quotation list.

The Board of Directors approved a depositary agreement between JSOC Bashneft and Citi, and decided to convene an Extraordinary General Meeting of Shareholders by absentee vote on August 14, 2014, with the list of eligible participants to be compiled on 14 July 2014.

The meeting will consider the approval of a related-party transaction, in particular, an underwriting agreement between JSOC Bashneft and banks Morgan Stanley, Barclays, Sberbank CIB and/or their affiliates.

«The agenda items considered by the Board of Directors and the underwriting agreement proposed for approval at the shareholder meeting comprise a part of the corporate actions being undertaken to prepare the Company for a possible secondary offering of its securities," commented Felix Evtushenkov, Chairman of the Board of Directors of Bashneft. «A final decision on the offering is subject to a number of factors, including market conditions, and has not yet been taken. The parameters of a possible SPO, including the size of the stake in Bashneft to be offered by its majority shareholder, JSFC Sistema, and amount of shares that may be offered by the Company itself are currently under discussion.»

The Board of Directors accepted the resignation of Igor Marchenko, a member of the Management Board and Vice President for Strategy and Development, who has decided to continue his career outside the Company. The Board of Directors expressed their gratitude to Mr Marchenko for the valuable contribution he has made to Bashneft’s business.

The Board also approved a number of transactions related to the Company’s day-to-day operations.

The information contained herein does not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities referred to herein in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any jurisdiction.

This press release does not constitute or form a part of any offer or solicitation to purchase or subscribe for securities in the United States. The securities to which these materials relate have not been registered under the US Securities Act of 1933, as amended (the «Securities Act»), and may not be offered or sold in the United States absent registration or pursuant to an exemption from the registration requirements under the Securities Act. JSOC Bashneft has not registered and does not intend to register any part of the offering in the United States or to conduct a public offering of the securities in the United States.

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This press release or information contained therein is not an offer, or an invitation to make offers, to sell, exchange or otherwise transfer securities in the Russian Federation to or for the benefit of any Russian person or entity and does not constitute an advertisement or offering of securities in the Russian Federation within the meaning of Russian securities laws. Information contained in this announcement is not intended for any persons in the Russian Federation who are not «qualified investors» within the meaning of Article 51.2 of the Federal Law no. 39-FZ «On the Securities Market» dated 22 April 1996, as amended (the «Russian QIs») and must not be distributed or circulated into Russia or made available in Russia to any persons who are not Russian QIs, unless and to the extent they are otherwise permitted to access such information under Russian law. The GDRs have not been and will not be registered in Russia and are not intended for «placement» or «circulation» in Russia (each as defined in Russian securities laws) unless and to the extent otherwise permitted under Russian law.

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