INVESTOR PRESENTATION Q1 2015 29 May 2015 DISCLAIMER This - PowerPoint PPT Presentation

INVESTOR PRESENTATION Q1 2015 29 May 2015

DISCLAIMER This presentation (hereinafter – the “Presentation”) of the Alliance Oil Company (hereinafter – the “AOC”) was prepared exclusively for the information purposes in order to improve the transparency of disclosure of relevant information and materials of AOC and establish a continuous dialogue with investors. The data contained in this Presentation constitute the confidential information of the AOC group of companies and shall not be disclosed or transmitted to any third parties without the prior written consent of the disclosing party. The information contained in this Presentation was prepared and provided by the AOC structural departments. These data can be changed with the course of time and are subject to regular update and amendment. This presentation is not an offer or solicitation of an offer and does not cause creation of any rights or obligations from the AOC and/or potential partners to carry out transactions or to enter into negotiations on cooperation. The information provided in this Presentation is not an offer or proposition to conclude an agreement. AOC makes no warranty in respect of the accuracy or reliability of the information contained in the Presentation and accepts no liability for any losses suffered by third parties arising from inaccuracy or unreliability of such information as well as for other negative effects. 2

HIGHLIGHTS FOR Q1 2015 AND Q1 2014 Financial Results Revenue of MUSD 498 (MUSD 861 in Q1 2014 ) EBITDA of MUSD 86 (MUSD 137 in Q1 2014) Loss of MUSD 23 affected by FX loss of MUSD 20 (loss of MUSD 24 in Q1 2014) Operational Results 4.8 mboe produced in Q1 2015 (5.1 mboe in 1Q 2014) 7.9 mbbl of oil refined in Q1 2015 (8.0 mbbl in 1Q 2014) Strategic Highlights MUSD 350 Eurobonds partial repayment and prolongation till March 2019 MRUB 11,500 short-term bank loan prolongation till September 2015 3

UPSTREAM OPERATIONS Crude oil and gas reserves and production Timano-Pechora 1Q 15 production: Khanty-Mansiysk and 1.3 mboe (27%) 1 Yamalo-Nenetsk 2 1Q 14 production: 1Q 15 production: 1.4 mboe (28%) 0.7 mboe 1Q 14 production: 0.6 mboe Volga-Urals and Kazakhstan Tomsk 1Q 15 production: 1Q 15 production: 2.3 mboe (47%) 1.2 mboe (26%) 1Q 14 production: 1Q 14 production: 2.2 mboe (44%) 1.4 mboe (28%) Alliance Oil Company, consolidated 2P oil reserves: 614.4 mboe 3 2P gas reserves: 47.5 mboe 1Q 15 production: 4.8 mboe (average daily: 53,295 boepd ) 1Q 14 production: 5.1 mboe (average daily: 56,129 boepd ) Notes: (1) Percentage in consolidated Alliance Oil Company production. (2) Through the Group’s operations with AROG (Alliance Repsol Oil & Gas), a joint venture with Repsol, which is accounted for under the equity method. 4 (3) As per DeGolyer & MacNaughton as of 31 December 2014.

UPSTREAM OPERATIONS Crude Oil Sales and Netbacks Crude Oil Sales, mbbl Crude Netback Prices, USD/bbl Export CIS Domestic Intra-group Export Domestic 60 6,0 53 4,6 50 4,4 47 4,0 40 2,4 2,3 28 30 2,0 20 0,8 19 0,9 0,2 10 1,4 1,0 0,0 0 Q1 2015 1Q14 1Q15 Q1 2014 Increased overall sales due to reallocation of December volumes to 1Q in order to obtain higher prices Preferential shipment to export due to weak domestic demand (effect of tax maneuver) No shipments to CIS market due to weak demand Decreased netbacks in all destinations due to lower oil prices Reduced revenues from crude oil sales due to earlier prepaid shipments to offtakers at fixed FX rate Notes: The netback prices are calculated by deducting VAT, railway and pipeline transportation costs (for Russian domestic sales) or tr ansportation, export duty, brokers’ commission and certain other costs (for export sales) or transportation, brokers’ commission and certain other costs (for CIS countries sales) from the gross price. 5

UPSTREAM OPERATIONS Gas Sales and Price Gas Sales and Prices 1Q14 1Q15 Gas Gas liquids Gas Gas liquids 573 593 118 341 558 613 95 246 Sold volume, boe 14,9 54,5 8,4 32,6 Gross price, USD/boe 12,6 46,2 7,1 27,6 Net price, USD/boe Decreased sales volumes due to revised field development scheme Gas and gas liquids economics negatively affected by increase in RUB/USD exchange rate Notes: The net prices are calculated by deducting VAT (for Russian domestic sales). 6

UPSTREAM OPERATIONS Crude Oil and Gas Sales Revenue from sales of crude oil, gas and gas liquids, MUSD Export CIS Domestic Intra-group 300 242 250 200 114 135 150 100 71 60 8 50 31 61 33 0 1Q14 1Q15 Two factors contributed to the decrease in revenue from sales of crude oil: decreased netbacks in all destinations due to lower oil prices and reduced revenues from crude oil sales due to earlier prepaid shipments to offtakers at fixed FX rate 7

DOWNSTREAM OPERATIONS Assets and refining volumes Kamchatka region Retail gas stations: 18 Marine terminals: 2 Jet fuel depot: 1 TOTAL Retail gas stations: 291 Oil depots: 20 Far East: Amur, Primorsk and Marine terminals: 4 Khabarovsk regions Jet fuel depot: 1 Retail gas stations: 260 Railway tankers: 1 440 Oil depots: 20 Marine terminals: 2 Railway tankers: 1 440 The Republic of Buryatia Khabarovsk Oil Refinery Retail gas stations: Refining volumes: 13 1Q 15: 87,342 bopd (1Q 14: 89,029 bopd ) Throughput: 1Q 15: 7.66 mbbl (1Q 14: 7.74 mbbl ) 8

DOWNSTREAM OPERATIONS Oil products sales and Prices Oil Products Sales, mbbl Oil Products Net Prices, USD/bbl Export Bunkering Wholesale Retail Export Bunkering Wholesale Retail 10,0 160 9,0 140 7,8 7,8 8,0 136 120 1,2 1,3 7,0 100 100 6,0 85 2,2 2,5 76 5,0 80 74 4,0 60 58 1,1 2,4 3,0 43 40 2,0 38 2,9 20 1,0 2,0 0,0 0 1Q14 1Q15 Q1 2015 Q1 2014 Preferential shipments to export (effect of decrease in export duty due to tax maneuver and decrease in crude oil price) and the domestic market due to higher margins at the expense of bunkering volumes Net USD prices decreased primarily due to RUB depreciation (average RUB\USD exchange rate increased Q1 2015 vs Q1 2014 by 78%) 9

DOWNSTREAM OPERATIONS Oil products sales Revenue from sales of oil products, MUSD Export Bunkering Wholesale Retail 800 719 700 165 600 500 426 224 400 114 300 145 185 200 42 100 145 126 0 1Q14 1Q15 Despite flat volumes and increased RUB-nominated prices in the domestic market, total amount of revenue nominated in USD decreased due to dramatic increase in RUB/USD exchange rate 10

FINANCIALS Q1 2014 Q1 2015 34,96 62,19 RUB/USD exchange rate, average Macro 110,51 52,63 Urals, average 861 498 Revenue 67 42 Operating income 137 86 EBITDA Profit or loss, MUSD EBITDA Margin 16% 17% -51 -20 FX loss -24 -23 Loss for the period 5 740 3 537 Total assets Statement of financial 407 217 Cash and cash equivalents position, MUSD 2 242 2 151 Total debt 361 13 Total cash flow from operating activities -253 -45 Cash flow, MUSD Total cash flow used for investments 31 -57 Total cash flow from/(used in) financing activities Stable EBITDA margin Group’s financials negatively affected by RUB depreciation (RUB -denominated assets and results presented in USD) and dramatic decrease in crude oil prices Operating income was negatively affected by earlier prepaid shipments to offtakers at fixed FX rate 11

FINANCIALS Segment Performance Revenue Breakdown, MUSD Upstream Downstream 1 000 900 800 700 600 719 500 400 426 300 200 242 100 135 - 1Q14 1Q15 Upstream segment revenue decreased primarily due to decreased USD-nominated oil prices in all destinations and earlier prepaid shipments to offtakers at fixed FX rate Downstream segment revenue decreased primarily due to RUB depreciation Notes: Segment revenue is based on total sold volumes including external and intra-group. Segment revenue excludes other income. 12

FINANCIALS Segment Performance EBITDA, USD/bbl EBITDA Distribution, MUSD Upstream Downstream Upstream Downstream 113 120 25,0 22,4 100 20,0 80 15,0 63 60 48 42 10,0 8,1 8,0 40 6,1 5,0 20 - 0,0 1Q14 1Q15 1Q14 1Q15 Upstream segment EBITDA decreased primarily due to decreased USD-nominated oil prices and earlier prepaid shipments to offtakers at fixed FX rate Despite RUB depreciation, Downstream segment EBITDA increased primarily due to higher RUB-nominated prices and lower crude oil component in the cost of oil products Notes: EBITDA for Upstream and Downstream segments is based on IFRS financial information. Segment EBITDA is based on total sold volumes 13 including external and intra-group.

FINANCIALS Upstream Economics Crude Oil Economics, USD/bbl 1 1Q14 1Q15 28,14 Revenue 52,73 Production Costs 4,80 7,70 10,18 Production and Other Taxes 14,68 SG&A and Other 2 4,76 6,45 8,40 EBITDA 23,90 EBITDA decreased primarily due to RUB depreciation and earlier prepaid shipments to offtakers at fixed FX rate Gas and Gas Liquids Economics, USD/boe 1Q14 1Q15 Revenue 10,11 18,34 Production Costs 1,49 1,18 2,39 Production and Other Taxes 3,07 SG&A and Other 0,00 0,73 EBITDA 6,54 13,05 Gas and gas liquids economics negatively affected by increase in RUB/USD exchange rate Notes: (1) Based on total upstream sold volume including external and intra-group; (2) Selling, administrative and other income/expenses, include transportation tariffs and other selling expenses, administrative expenses and other operating income/expense. 14