OREANDA-NEWS. July 01, 2011. In line with the agenda, the shareholders approved the annual report and annual accounting statements of OJSC “Surgutneftegas”, including the profit and loss account for 2010, reported the press-centre of Surgutneftegas.

The meeting resolved to declare payment of dividends for 2010 as follows: RUB 1.18 per preferred share and RUB 0.5 per ordinary share.

The meeting elected the following members of the Board of Directors: S.A.Ananyev, V.L.Bogdanov, A.N.Bulanov, I.N.Gorbunov, V.E.Druchinin, V.P.Erokhin, N.I.Matveev, N.Ya.Medvedev, and A.F.Rezyapov.

The meeting also elected the Auditing Committee of three people and approved LLC “Rosexpertiza” as auditor for 2011. In addition, the meeting resolved to approve transactions that may be conducted in the future by OJSC “Surgutneftegas” and its affiliates in the course of its general business activity.

In his report about the 2010 results, Vladimir L. Bogdanov, Director General of OJSC “Surgutneftegas”, said that despite the unstable environment, the company succeeded in implementing all production programs. Surgutneftegas achieved its targets to stabilize crude output in Western Siberia and boost production in new oil and gas provinces, laid the groundwork for further reserve additions, continued to develop the gas sector and small-scale power generation, and upgraded refining capacity.

“It is important to closely follow the long-term development policy and pursue implementation of our business priorities,” Vladimir Bogdanov emphasized. “These goals are supported by stable investments, which reached RUB 140 bn in 2010”.

At year end, Surgutneftegas accounted for more than 31% of domestic exploratory drilling. Exploratory drilling efficiency exceeded 75%. The company discovered 4 fields and 10 new deposits, acquired 5 licenses in Khanty-Mansiysky Autonomous Okrug and Yakutia, and obtained 3 licenses for the fields discovered earlier.

The company added 81 million tons of oil to the reserves through geological exploration and acquisitions. Over the last five years, reserve replacement was more than 1.5 times higher than crude production.

Development drilling increased by 15% and allowed the company to commission 1,300+ new oil wells.

In 2010, one new field was put on stream, with another 21 fields to be commissioned by 2015.

Surgutneftegas has the highest ratio of associated petroleum gas utilization in the sector (95.9% in 2010).

In the reporting year, the company processed almost 7.3 bcm of gas, including 55% of the gas produced by the company, and produced approximately 722 thousand tons of liquid hydrocarbons.

Refining throughput totaled 21.3 mn tons. Limited Liability Company “Kirishinefteorgsintez” has almost completed the construction of the deeper refining complex based on residue hydrocracking processes.

In his report, Vladimir Bogdanov put particular emphasis on the company’s operations in Eastern Siberia. He mentioned that approximately 100 new wells are commissioned every year at two fields in the region, the Talakanskoye and the Alinskoye fields. In 2010, crude production in the Republic of Sakha (Yakutia) amounted to 3.3 mn tons whereas this year it is expected to reach 5.4 mn tons.

At the end of the reporting year, the company’s license portfolio in Eastern Siberia included 24 license areas. The region is being actively explored.

During the next five years, four new fields will be brought on stream in Eastern Siberia.

Talking about the financial results of the year, Mr. Bogdanov noted that the company’s production figures, together with better macroeconomic environment and higher energy prices, made it possible to improve the company’s financial performance. Sales profit grew by 17%; the rate of return on operating activities remained at the last year level of 25%. Net profit totaled RUB 128 bn, a 13% increase from the previous year.

“All achievements of the company are based on conscientious and hard work of one hundred thousand employees,” Mr. Bogdanov said, adding, “Together we will deal successfully with the tasks of sustainable long-term development of the company, increasing the profitability and stock capital.”