Public Joint Stock Rosneft Oil : 2019 Full Year IFRS (Presentations)

Rosneft Oil Company

IFRS Results

Q4 and 12M 2019

February 19, 2020

Important Notice

Information herein has been prepared by the Company. The presented conclusions are based on the general information collected as of the date hereof and can be amended without any additional notice. The Company relies on the information obtained from the sources which it deems credible; however, it does not guarantee its accuracy or completeness.

These materials contain statements about future events and explanations representing a forecast of such events. Any assertion in these materials that is not a statement of historical fact is a forward-looking statement that involves known and unknown risks, uncertainties and other factors, which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. We assume no obligations to update the forward-looking statements contained herein to reflect actual results, changes in assumptions or changes in factors affecting such statements.

This presentation does not constitute an offer to sell, or any solicitation of any offer to subscribe for or purchase any securities. It is understood that nothing in this report / presentation provides grounds for any contract or commitment whatsoever. The information herein should not for any purpose be deemed complete, accurate or impartial. The information herein in subject to verification, final formatting and modification. The contents hereof has not been verified by the Company. Accordingly, we did not and do not give on behalf of the Company, its shareholders, directors, officers or employees or any other person, any representations or warranties, either explicitly expressed or implied, as to the accuracy, completeness or objectivity of information or opinions contained in it. None of the directors of the Company, its shareholders, officers or employees or any other persons accepts any liability for any loss of any kind that may arise from any use of this presentation or its contents or otherwise arising in connection therewith.

2

ESG is the Key Company Development Pattern

September 2019 -The Russian Federation ratifies the Paris

Climate Agreement

UN Secretary-General Antоnio Guterres called on all leaders to reduce GHG emissions by 45 % over the next decade, and to net zero emissions by 2050

The World Economic Forum's Global Risks Report:

Climate change risks areTop 5 Global Risks

Rosneft response

Carbon management sub-committeewas established

The Integrated Carbon management planwas approved by the

CEO

«Guiding Principles on Reducing Methane Emissions»were signed

Cooperation Agreement with the Russian Ministry of Natural Resources was signed as a part of the national «Environment» projectto preserve the biological diversity

Rub 300 bnof "green" investments in 2018-2022

8 mmt of CO2eprevented GHG emissions (by implementing Energy Saving Program)

Examples of ESG commitment

Arctic ecosystems research initiatives:

polar bear, walrus, ice studies

Projects to support indigenous people of the North:IT support at indigenous settlements, «Evenkiysky Reindeer» animal range research, «Northern friendship» - supporting indigenous languages

Rosneft Oil Company annually presents its updated public statement -«Rosneft: Contributing to Implementation of UN Sustainable Development Goals»

3

Top Quartile Industry Performance in International ESG Ratings

Rosneft included in the FTSE4Good Index

The FTSE Russell rating increased by 0.3 points to 3.8

One of the leaders

(ahead of most global oil and gas companies)

The rating increased by 2.08 points to 65.15

BP 67.6; Rosneft 65.15; Total 61.8; Eni 61; Shell 60.2, Lukoil 59.3; Repsol 58.9,Exxon 56; Equinor 55.2;Gazprom Neft 53.1; Chevron 51; Sinopec 48.5; Gazprom 44.8; PetroСhina 38.6

The best Russian Company in the rating

The rating increased by 11 points to 32.7

Repsol 70.1; Eni 68.7; Shell 57.1; BP 53.9; Total 51.3; Equinor 41.3; Chevron 33.5; Rosneft 32.7; Lukoil 28.2; Exxon 22.7; Gazprom 10.4; PetroChina 10; Sinopec 4.8

The best Russian oil and gas company in the Global CDP climate change and water security rating

The climate change rating increased by four notches to B Rosneft was assigned the B- water security rating participating for the first time

CDP Climate change: Eni A-; Total А-;Rosneft B; Equinor B; Shell B; Gazprom C; Lukoil D

CDP Water Security: Eni A-; Total А-;RosneftB-; Gazprom C

*

In the industry top-5

The rating increased by 8 points to А

BP А; Shell А; Chevron А; Total А; Rosneft А; Exxon А; Equinor А; Eni A; Lukoil A; Repsol A-; Gazprom Neft A-; Sinopec B+; PetroСhina B; Gazprom B

Record high rating improvement

The rating increased by 12 points to 57

* Refinitiv is in the process of merging with the London Stock Exchange Group

4

Financial Results

5

2019 Key Highlights

283Record high dividends

Rub bn

884Strong free cash flow

Rub bn

907Rub bn	Reduction of financial debt
and trading liabilities

6

EBITDA and Net Income Dynamics

EBITDA 2019 vs 2018

Net Income 2019 vs 2018

12M 2018

Exchange rate

Completion of

the tax maneuver

and other

Crude oil price

Share in profits of

associates and JVs

Export duty lag

Other taxes

Introduction of excess profit tax

Indexation

of transport tariffs

Change in Volumes

OPEX

General costs

2,081

External factors:

+11 Rub bn

+0.5%

Internal and seasonal factors:

+13 Rub bn

0.6%

Rub bn

83

(29)

(161)

18

24

(8)

102

(18)

63

(17)

(33)

Net income attr.										Rub bn
549
to shareholders
12M 2018
Minorities			100
12M 2018	649
EBITDA
			24
DDA			(52)
Income tax		(9)
Financial expences
			84
(net)
Other income		(38)
Other costs			141
FX gains/losses		6
12M 2019		805
Minorities			97
Net income attr.

12M 2019

2,105

to shareholders	708
12M 2019

7

CAPEX

CAPEX evolution		2019 CAPEX breakdown

Rub trln
					91%Upstream
				7%	Mature assets
					Key projects and greenfields
				0.85	International projects
			~1	Rub trln	52%
0.92	0.94		8%Refining, Commerce
0.85		32%	and Logistics
					2%Other
2017	2018	2019	2020
			plan

6,1$/boe	>90%	~270Rub bn	~14%
Unit Upstream CAPEX	Share of Upstream CAPEX	Investments in	Hydrocarbon production
	new off- and onshore	of key projects
		upstream projects	and other greenfields
			(Upstream)

8

Free Cash Flow Allocation

Free cash flow calculation

Net cash

provided by

operating activities

Reimbursement of

prepayments received

(historical FX rate)

Reimbursement of other financial obligations

FX rate change

effect

Interest on

prepayments

Prepayments for

future supplies

Reimbursement of prepayments pranted

Adjusted operating cash flow

1,110

Reimbursement of prepayments under LT crude oil supply contracts (at an average FX rate)

Rub 472 bn

1,738

Rub bn

344

172

113

70

67

(138)

Free cash

flow

Interest1

884

Dividends2

Reduction of liabilities

CAPEX

(854)

Free cash flow	884

Note: (1) Including interest on prepayments, (2) Including dividends paid to minorities

9

Delivering Rosneft-2022 Strategy in 2019

	3.1$/boe	leadership in
	lifting costs1
Enhancing	-13.8%	reduction of well costs 2
yields
>2.5
	refining and petrochemicals

• cost reduction3

Key projects	22.5 mmt	liquids production at key projects
delivery	21 mmt	liquids production from
	hard-to-recover reserves

~99%

Structural and

technological ~52th.transformation

Digital services

of drilling rigs connected to automatic data- collection systems4

wells connected to automatic data-collection systems4

as part of Data processing center

Note: (1) Operating costs, (2) In comparable terms vs 2016 actual figures, (3) In comparable terms , expected results for 2019, (4) Information system «TIS-Dobycha». General	10
implementation status from the beginning of initiatives.

Oil Market Volatility

Crude oil and high-sulphur fuel oil prices		Gross upstream margin1
90	$/bbl	Brent	0	12	'000 Rub/bbl	Monthly average
		Urals				FY average
		HSFO-Brent crack spread
80			-10
				9
70			-20

6

60

-30

50		-40	3

Note: (1) Calculated as Urals price less MET, export customs duty and transportation costs at the Yugansk-Primorsk route

11

Efficient Cost Control

Lifting costs		Refining costs in Russia

Rub/boe	Quarter		12M average	% YoY	Rub/bbl		Quarter	12M average	% YoY
			199		215		213	202	220
205		203	201	196		183		191
195			23.8%
					12.0%	8.9%
	5.4%	5.7%					6.1%
3.0%	4.1%					2.3%
				-4.4%
Q4 18	Q1 19	Q2 19	Q3 19	Q4 19	Q4 18	Q1 19	Q2 19	Q3 19	Q4 19

	General and administrative costs1				Producer Price Index (annual basis)
Rub/boe		Quarter	12M average		% YoY

98			79
		88	90
			15.3%
	76
		64
		11.4%
					10.0%
	5.6%
				-8.2%			6.6%
-10.1%
			-21.0%					-0.6%
								-5.6%
Q4 18	Q1 19	Q2 19	Q3 19	Q4 19	Q4 18	Q1 19	Q2 19	Q3 19	Q4 19

Note: (1) excl. provisions

12

Financial Summary

Record high EBITDA

Net income growth by 29%

Amount of dividends paid increased by more than 1/4

2,081	2,105
2018	2019

	708
549
2018	2019

	283
225
2018	2019	13

2020+ Growth Drivers

1

Operational

• Change in the structure of crude oil production to higher- margin barrels
• Proceeds from international projects including Zohr (offshore Egypt) and export pipeline concession (Kurdistan)
• Launch of Rospan gas field with high liquids component

2

Financial

• Introduction of new tax incentives for the Priobskoye oil field
• Interest expense reduction following:
  а) a reduction of key rates
  б) debt structure optimization

3

Accounting

• Impairment of assets in 1Q 2019 of RUB 90 bln creates alow-base effect for 2020
• Zero impact from cash flow hedges reclassified to profit and loss statement starting from January 1, 2020
• Lower negative impact of prepayments reimbursement recorded at historical FX rate on the balance sheet

High dividend yields covered by strong and growing free cash flow

14

Operating Results

15

Production

	Liquids production
5.0	mmbpd	200		mmcmd
				liquids	170
4.8			gas	140
2017	2018	2019

4.6

4.4

4.2

4.0
	2017	2018	2019
6%	8%	21%

ХХ% - share of high-margin barrels in total production. Includes fields that switched to excess profit taxation as well as greenfields MET and export duty tax breaks

• Rapid development of new large projects with incremental production growth of up to 140.3 mmbbl (+27% vs 2018)
• Accelerated development ofhard-to-recover low taxed reserves ensuring production growth up to 154.7 mmbbl (+12% vs 2018)
• Reducing production decline rates at the Samotlor field following tax incentives introduction: c. 1% in2018-2019 vs c. 5% in 2008-2017
• Excess profit taxation (EPT) regime improves the investment returns of new projects
• Approval of MET tax breaks for the Priobskoye filed (to stimulate complex geology reserves development) is expected

Increase of high-margin low taxed barrels

under the OPEC+ limitations

16

Efficient Application of Advanced Technologies

Commissioning of new wells

wells

total

horizontal

with multi-stage hydrofracs

Continuous work on improving new wells design aimed at enhancing field development efficiency:

The share of horizontal wells increased to 57% of total

wells (+21 p.p. vs 2017)

Wide application of complex well completion methods:

3,366

1,204

719

3,484

1,661

1,082

2,923

1,675

986

share of horizontal wells with multi-stage hydro

fracs increase to 34% (+3 p.p. vs 2018)

number of multilateral wells increased by 80% YoY

Liquids production per horizontal well increased by

11% vs 2018 and is 2.4x times exceeds the level of

inclined wells

2017	2018	2019
36%	48%	57%

ХХ% - share of horizontal wells in the total number of wells commissioned

17

Near-term Plans

Enhancing returns through

continuous efficiency improvement

250 mmt

by 2022

>100 bcm

by 2022

>160 kbd

total fields' production in 2022

<4$/boe <7$/boe

average unit OPEX and CAPEX until 2022

Liquids production growth

Gas production growth with domestic market increase to 20%

Full development of large-scale projects (Erginskiy block, Chaprovskoye, Severo- Danilovskoye, Lodochnoye, Severo-Komsomolskoye fields)

Maintaining leadership in production efficiency

18

Refining

Refining margins

				Russia 1					Europe									9.23		$/bbl
					7.52		7.62			7.78
5.63																		6.31
												5.27	5.13
														5.06
																				2.62
										0.38								-0.10
					-0.63									-1.00
-1.30
															-1.58
	Q1 2018		Q2 2012		Q3 2018		Q4 2018	Q1 2019	Q2 2019	Q3 2019		Q4 2019
		Key refining indicators
						Refining in Russia, mmt					Refining abroad, mmt
						Light product yield, %
					57.7									57.2			56.7
																	2.85
					2.74											2.82
					26.79								27.22
														25.51
						Q4 2018							Q3 2019		Q4 2019
	Note: (1) Including the reverse excise tax on crude and dampfer for motor fuels

Refining economics in Q4 2019

• Q4 2019 refining margin in Russia was negatively impacted by current macro environment: falling HSFO prices ahead of IMO implementation. Moreover, refining throughput reduced following turnarounds at some refineries
• Decrease of margins in Germany was mainly driven by falling gasoline and diesel crack spreads QoQ

Q4 2019 results and achievements

• Komsomolsk refinery and Ufa group of refinerieslaunched production of low-sulphur bunker fuel RMLS complying with IMO 2020 requirements
• Ufa group of refinerieslaunched production of high-octane gasoline RON-100 under a proprietary technology
• New gasoline gradeRON-95-K5(Euro-6) with improved environmental standards was launched at the Ryazan refineryto supply Moscow region

19

Focus on Distribution Channels Development

Netbacks for the main crude oil marketing channels		Crude oil marketing breakdown

Export, Asia			Export, Europe			mmt
Refining in Russia			Domestic market
430							$/t
								61.1	66.3	67.1
390
350								Export, West	24%	24%	22%
310
270
Q1 2018	Q2 2012	Q3 2018	Q4 2018	Q1 2019	Q2 2019	Q3 2019	Q4 2019
								Export, Asia	26%	29%	35%
Motor fuel sales on the domestic market increased by	5.7% YoY
to 29.9 mmt in 2019						Export, CIS	4%
								4%
Motor fuel sales via the exchange exceeded the required levels	Domestic market	2%
		2%	3%
by over 2x times										2%
Crude oil supplies eastwards reached 79.7 mmt for 12M 2019,
(+34.6% YoY)
In 2019 a 2-year contract signed with PKN Orlen SA for the	Refining in Russia	44%	41%	38%
supplies of crude towards Poland and extended a 3-year contract
for the supplies of crude to the Czech refineries
									Q4 2018	Q3 2019	Q4 2019

20

Premium Marketing Channels Development

Avia

Key achievements

Bunker fuel

Lubes

Bitumen

Jet supplies to the airports of the Moscow Air Cluster increased by 11% YoY

Number of into-plane fueling increased by 5% to over 230'000 operations

481'000 tons of jet fuel sold abroad jointly with RN Deutschland, into-plane fueling started in German airports

In 2019 RN-Bunker started bunkering of environmental friendly marine fuel with sulphur content below 0.1%

(ТМS type A). The fuel is in full compliance with MARPOL requirements

Introduction of new motor oil with extended drain interval Revolux D3 LL 15W-40

Expansion of lubes range with thread dopes used in drilling

Increase of large retail chain (>200 shops) footprint

New innovative product sales, polymer-bitumen binder, rose by 41% YoY (from 75.8 to 106.9 th. tons)

Sales volumes

3.8 mmt	2.8 mmt	0.9 mmt	2.6 mmt
jet fuel1	bunker fuel	lubes	bitumen

Note: (1) Includes international sales

21

Progress in Development of the Retail Channel

Retail

6%- increase of motor fuel sales1

16%- increase of sales using fuel cards1

Key achievements

Increasing the number of loyalty programs participants. As of Dec 31, 2019 13.6 mln people were involved in 64 Russian regions

Virtual cards «Family team» and «BP Club» were launched as well as VC for legal entities, payments through mobile apps was introduced at all sites under BP brand in Russia

Sales geography expansion:

• branded gasoline Pulsar -+2 new regions (52 retail sites) to 10 existing regions (61 retail site).
• Euro 6 gasoline with improved features -9 regions of sales as of the year end (+6 regions vs 2018). The fuel was included in 100 Best Products of Russia

Acquisition of a 100% stake in the entities of «Petersburg Fuel Company» was completed. Following the deal the Company took the lead in one of the key country regions. Retail network expanded to 3'069 as of the year end

2,500 cars fill up daily at the 12 existing compressed natural gas sites, sales exceed 1.7-2 mcm monthly

By-product sales

2%- by-product and services revenues growth1

6%- increase of hot beverages sales1

Efforts undertaken

Comprehensive modernization of sites under BP brand focused on coffee supply - 14 cafés opened in 2019. Development of small-scale retail sites (BP)

-5 sites opened

Food supply projects: at Company retail sites 1,450 hot dogs cooking modules are working, 2,530 retail sites equipped with coffee machines, at 780 retail sites self-service zones were opened, coffee corners were installed

A number of own brand products including water, sweet bars, napkins and glass cleaner was sold at 38 Company subsidiaries

Offer unification of cafés and shops at filling sites of «Petersburg Fuel Company» continues

Measurement automation is underway - 90% of procedures on product flows of filling stations and oil depots completed

Note: (1) 2019 vs 2018

22

Appendix

23

Key Operational Highlights

Indicator	Q4 2019	Q3 2019	%	2019	2018	%

Hydrocarbon production, incl.

kboed

Liquids

kbpd

Gas

kboed

Oil refining

mmt

Product output in Russia

mmt

5,814

5,740

1.3%

5,791

5,795

(0.1)%

4,674

4,661

0.3%

4,674

4,673

0.0%

1,140	1,079	5.7%	1,117	1,122	(0.4)%

28.33

30.07

(5.8) %

110.23

115.04

(4.2)%

24.72	26.31	(6.0)%	96.78	99.73	(3.0)%

24

Key Financial Highlights

Indicator	Q4 2019	Q3 2019	%	2019	2018	%
EBITDA, Rub bn	488	554	(11.9)%	2,105	2,081	1.2%
Net Income, Rub bn	158	225	(29.8)%	708	549	29.0%
attributable to Rosneft shareholders
Adjusted net income1, Rub bn	184	262	(29.8)%	917	828	10.7%
attributable to Rosneft shareholders
Adjusted operating cashflow2, Rub bn	491	479	2.5%	1,738	2,069	(16.0)%
CAPEX, Rub bn	220	198	11.1%	854	936	(8.8)%
Free Cash Flow, Rub bn	271	281	(3.6)%	884	1,133	(22.0)%
EBITDA, $ bn	7.7	8.5	(9.4)%	32.5	33.1	(1.8)%
Net Income, $ bn	2.4	3.6	(33.3)%	10.9	8.9	22.5%
attributable to Rosneft shareholders
Adjusted net income1, $ bn	2.9	4.1	(29.3)%	14.2	13.1	8.4%
attributable to Rosneft shareholders
Adjusted operating cashflow2, $ bn	7.8	7.4	5.4%	26.9	32.9	(18.2)%
CAPEX, $ bn	3.5	3.0	16.7%	13.2	15.0	(12.0)%
Free Cash Flow, $ bn	4.3	4.4	(2.3)%	13.7	17.9	(23.5)%
Urals price, '000 Rub/bbl	3.92	3.96	(1.0)%	4.11	4.38	(6.2)%

Note: (1) Adjusted for FX gains/losses and other one-off effects; (2) Adjusted for prepayments under long-term crude oil supply contracts (including accrued interest) and operations with	25
trading securities (RUB equivalent)

EBITDA and Net Income Dynamics

EBITDA Q4 vs Q3 2019		Net income Q4 vs Q3 2019

Q3 2019

Exchange rate

MET rate

Crude oil price

Share in profits of

associates and JVs

Export duty lag

Reverse excise tax

Change in volumes

OPEX

Loss allowance

General costs

Exploration costs

Q4 2019

External factors:

-48 Rub bn -8.7%

Internal and seasonal factors:

-18 Rub bn -3.2%

488

554	Rub bn	Net income	225
attr. to shareholders
		Q3 2019
(12)		Minorities
(11)		Q3 2019	250
(35)		EBITDA
2		DDA	(5)
25
	Income tax			(9)
(17)		Financial expenses
	(1)
	(net)
14		Other income	1
(6)		Other costs	(4)
(13)
	FX gains/losses		13
(12)
	Q4 2019	179
(1)		Minorities		21
		Net income
		158
		attr. to shareholders
		Q4 2019

Rub bn

25

(66)

26

Key Projects Development

Severo-Komsomolskoye

3Р reserves (PRMS)

• 269 mmtoe

1stphase of the full
field development
started
2019 production -
0.3 mmt1(>100% vs
2018)
In 2019 25 wells drilled, 1stphase of the preliminary water
gathering unit launched, pipelines, well pads and motor road
built
Exploration drilling, site preparation and phase one facilities
construction scheduled for 2020	YaNAO

Lodochnoye

3Р reserves (PRMS) - 85 mmtoe

Startup preparation is underway

2019 production - 0.64 mmt (>100% vs 2018)

16 wells drilled in 2019

Continued exploration drilling and construction of infrastructure facilities scheduled for 2020

KhMOA

Irkutsk

region

Erginskiy cluster

3Р reserves (PRMS) - 482 mmtoe

Kondinskoye (2017) and Zapadno-Erginskoye (2019) fields launched

2019 production - 2.8 mmt (+74% vs 2018)

Central gathering station capacity at Kondinskoye field expanded, ground infrastructure development completed

Works at Chaprovskoye, Erginskiy and Novo-Yendyrskiy LA continue

Danilovskiy cluster

3Р reserves (PRMS) - 123 mmtoe

Preparation for the startup of the Severo-Danilovskoye field: construction of well pads, infrastructure facilities and pipeline started

Drilling of 95 wells planned

Synergies from joint usage of ground infrastructure of the Verkhnechonskoye field

Note: (1) PK1 formation

27

Progress on Key Projects: Rospan

	MAJOR DRIVER OF THE COMPANY NEAR-TERM PRODUCTION GROWTH
Indicator	Value
3Р reserves (PRMS)	897 bcm of gas
204mmt of gas condensate, LPG and oil
2019 production	6.7 bcm of gas
1.38 mmt of liquids
	Potential:
Annual production	> 21 bcm of gas
> 5 mmt of liquids
	up to 1.3 mmt of LPG
Commissioning year	2020

Current status and Q4 2019 results:

By 2019 year endkey field facilities construction was at final stage :

• Core-processequipment at the 1ststartup complex of the gas and gas condensate treatment unit (Vostochno-Urengoiskiy LA) was installed, main works on assembling and testing pipelines completed
• Main construction works at the oil treatment unit were completed, preparation for hot commissioning ofcore-process equipment is underway
• 6 of 7gas-turbine units at the Vostochno-Urengoiskiy LA were commissioned
• At the railroad terminal (Korotchaevo station) main works on installation of industrial pipelines,shut-off and control valves were completed

28

Gas Greenfields Development: Kharampur

THE MOST SIGNIFICANT (AFTER ROSPAN) PROJECT IN TERMS OF GAS PRODUCTION GROWTH1

IndicatorValue

3Р reserves (PRMS), gas	735 bcm2
Gas production plateau:	c. 11 bcmpa3
Phase 1 (Senomanian)
Commissioning year	2021

Current status and Q4 2019 results:

• Construction works at the gas treatment unit are underway: piling foundation, placing of concrete, steel frame installation
• Gas pipeline: construction works continue, 2ndunderwater passage over the Vasseyakha river started
• 57 of 61 wells have been drilled. As part of pilot production of the Turonian deposit collection and interpretation of geological information from the 1stwell continues
• Site preparation and access roads (to gas well pads) construction completed. Gas collection system, cluster pads and power facilities development continues.

Note: (1) The project involves a partner - BP, (2) Excluding dissolved gas and including the reserves of Turonian deposit, (3) With the potential of further growth to 24 bcm p.a. through full	29
scale development of Turonian deposit

Calculation of Adjusted OCF

Profit and Loss Statement

№	Indicator	2019,
$ bn
1	Revenue, incl.	135.8
	Reimbursement of prepayments and	9.8
	other financial obligations received
2	Costs and expenses, incl.	(113.9)
	Reimbursement of prepayments	(2.1)
	granted
3	Operating profit (1+2)	21.9
4	Expenses before income tax	(6.5)
5	Income before income tax (3+4)	15.4
6	Income tax	(3.0)
7	Net income (5+6)	12.4

Cash Flow Statement

2019,	Indicator	№
$ bn
12.4	Net income	1
10.9	Adjustments to reconcile net income to	2
cash flow from operations, incl.
	Reimbursement of prepayments
(7.1)	received under crude oil and
	petroleum products supply contracts

(2.7)	Reimbursement of other financial
obligations received

Reimbursement of prepayments

2.1granted under crude oil and petroleum products supply contracts

(4.8)	Changes in operating assets and	3
liabilities, incl.
(1.1)	Interest on prepayments under long-
term crude oil supply contracts
(1.4)	Income tax payments, interest and	4
dividends received
17.1	Net cash from operating activities	5
(1+2+3+4)
1.0	Prepayments for future supplies	6
8.8	Effect from prepayments	7
26.9	Adjusted operational cash flow	8
(5+6+7)

30

Finance Expenses, Rub bn

Indicator	Q4 2019	Q3 2019	%	2019	2018	%

1. Interest accrued1
2. Interest paid and offset2
3. Change in interest payable(1-2)
4. Interest capitalized3
5. Net loss from operations with financial derivatives4
6. Increase in provision due to the unwinding of a discount
7. Interest on prepayments underlong-term oil and petroleum products supply contracts
8. Change in fair value of financial assets
9. Increase in loss allowance for expected credit losses on debt financial assets

10. Other finance expenses

Total finance expenses (1-4+5+6+7+8+9+10)

67	70	(4.3)%	282	282*	-
72	70	2.9%	283	284	(0.4)%
(5)	-	-	(1)	(2)	(50.0)%
37	39	(5.1)%	158	147	7.5%
-	-	-	-	17	(100.0)%
5	4	25.0%	19	19	-
14	16	(12.5)%	70	91	(23.1)%
-	-	-	-	12	(100.0)%
2	1	100.0%	5	7	(28.6)%
-	4	(100.0)%	9	9*	-
51	56	(8.9)%	227	290	(21.7)%

* Incl. reclassification of interest on lease agreements
Note: (1) Interest accrued on credits and loans and other financial obligations, (2) Interest is paid according to the schedule, (3) Interests paid shall be capitalized in accordance with IAS
23 standard Borrowing Costs. Capitalization rate is calculated by dividing the interest costs for borrowings related to capital expenditures by the average balance of loans. Capitalized
interest shall be calculated by multiplying average balance of construction in progress by capitalization rate, (4) Net effect on operations with financial derivatives was related to FX	31
component fluctuations of cross-currency interest rate swaps.

Variance Analysis

2019 EBITDA and net income sensitivity to +/- 10% change in Urals price

Rub bn

EBITDA

(283)283

Net income

(226)226

-10%	63.4	+10%
$/bbl

2019 EBITDA and net income sensitivity to +/- 10% change in Rub/$ exchange rate

млрд руб.

EBITDA

(344)

344

Net income

(275)275

-10%64.7+10%

Rub/$

Source: Company data

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Questions & Answers

33