OREANDA-NEWS. June 27, 2011. The Board of Directors of Sovcomflot reviewed and approved the Company’s Development Strategy until 2017.

 The strategy, in particular, envisages:

 - An increase in the proportion of the Company’s business involving the specialised shipment of energy resources, in particular liquefied natural gas (LNG) transportation and shuttle tanker operations;

 - Further development of the Company’s support activities, servicing the exploration and hydrocarbon production needs of offshore fields;

 - Maintaining expertise and leadership in the field of ice-class shipping;

 - Streamlining the Company’s conventional energy shipping operations, whilst maintaining the leading position in the product-carrier segment (MR, LR1, LR2), as well as the "Aframax" and "Suezmax" oil tanker segments, which are the most in demand for Russia’s foreign trade;

 - Diversification of the financing sources that support the Company’s investment programme;

 - Expansion of the Company’s planning horizon of the current development Strategy until 2017, and the synchronization of the Company’s development plans with the implementation of energy projects on Russia’s continental shelf.

 The Company’s Development Strategy has been updated to reflect adjustments in the plans of Russian oil & gas companies to develop Russia’s offshore energy resources, and to changes in global energy demand in favor of natural gas. The revised strategy has been prepared and is consistent with the Russian government’s plans to partly privatise the Company in 2011-2013.

 The approved strategy document reflects the main tenets of the Transport Strategy of Russia to 2030 and the Energy Strategy of Russia to 2030, as well as the development strategy for Russia’s shipbuilding industry to 2020.

 Sergey Naryshkin, Chairman of the Board of Directors of Sovcomflot said:

"The Sovcomflot Strategy of 2005-2010 was successfully completed, and saw SCF Group become the fastest growing tanker company in the world. Today, SCF has leading positions in several segments of the global tanker market. Our revised strategy acknowledges the opening of new investment opportunities associated with the development of offshore projects in Russia. Sovcomflot has a challenging task - to enter the industry’s high-tech market segments, which are new for the country and the most in demand with Russian oil and gas companies, whilst simultaneously maintaining its leadership in traditional tanker shipping markets. I am confident that the implementation of our new and approved strategy will contribute to a successful debut of Sovcomflot on the equity capital markets, in accordance with the state’s programme of privatisation of federal property."

 Nikolay Kolesnikov, Executive Vice President, Chief Strategy & Financial Officer, said:

 “The review of the Group’s strategy allows us to better assess our forthcoming capital needs and fine-tune investment priorities in line with the demands of our customers. We will continue to manage the Group’s exposure to the tanker cycle and we envisage growing further the share of specialised energy shipping segments (such as shuttle tankers and LNG) in our business portfolio, as well as expanding in the provision of upstream services to our core oil and gas customers in Russia and internationally.”

Elena Titova, Chairman of the Strategy Committee of the Board of Directors, said:

 "We started to work on the Strategy as long ago as 2010. The document was developed on behalf of the Board of Directors with input from the best external consultants and analysts, based on a vast array of economic research. The project was evaluated positively by the Strategy Committee, as well as a number of ministries and departments of the Russian Federation. "

 Sergey Kudryashov, Member of the Board of Directors, said:

 “Offshore oil & gas is becoming increasingly important to the world and for Russia. The new Strategy to 2017 takes full account of this trend in the energy industry and gives the Company additional opportunities for sustainable growth.”

 The Strategy will then be presented at the traditional Annual Conference of Business Partners on 20 September 2011.