OREANDA-NEWS. March 4, 2011. The net income increased 17% over 2009, and the EBITDA reached RUSD 60 billion 323 million;

Total oil & natural gas production was up 2% over 2009, averaging 2,583,000 barrels per day.

Six new production systems and two natural gas treatment         units went on stream;

The proved reserves closed the year at 15.986 billion barrels of oil equivalent (boe) by the SPE/ANP criterion. The Reserve Replacement Index (RRI) was 229%, and the reserve/production ratio stood at 18.4 years;

Investments totaled RUSD 76 billion 411 million, and were 8% above 2009, with a focus on increasing the oil and natural gas production capacity, on improving the refining park, and the natural gas infrastructure.

In 2010, the net leverage fell to 17%, down from 31%, and the Net Debt/EBITDA decreased from 1.23x to 1.03x, a result of the Capitalization process held in Sep/10;

The proposed distribution of dividends and interest on equity capital amounted to RUSD 11.728 billion (RUSD 7 billion 945 million were already anticipated in 2010).

Our consolidated net income for the year set a record of RUSD 35 billion 189 million as a result of an increase in gross profit (RUSD 77 billion 222 million) driven by higher product sales (+11%) and by the effect the more expensive oil prices had on exports and on the international output. Additionally, the exchange rate appreciation contributed to increase the profit, causing a positive impact on the net financial results (positive variation of RUSD 2 billion 725 million) and on the result attributable to minority shareholders (positive increase of RUSD 2 billion 581 million). The greater participation of domestic oil in the feedstock (79% to 82% in 2010), and the increased use of the refineries' nominal capacity, which averaged 93% in 2010, also tipped the result up.

The operating cash flow, measured by the EBITDA, set a record high of RUSD 60 billion 323 million. The proposed dividends totaled RUSD 11 billion 728 million, of which RUSD 7 billion 945 million were anticipated to the shareholders during 2010 as interest on net equity.

4Q net income up 24%, to RUSD 10 billion 602 million - The net income for the quarter was 24% higher than the previous quarter's. The main highlights were an 11% drop in operating expenses, lower income tax and social contribution payments (-34%) due to higher provisions for interest on net equity, and a shrinkage in oil and oil product import volumes (down 304,000 barrels/day). Additionally, there was an increased volume of gasoline (+9%) and jet fuel (+6%) sales due to heated economic activity.