14.03.2012
Re Presentation of Strategic Development Program
LUKOIL PRESENTS 2012-2021 STRATEGY
LUKOIL presents the Company’s 2012-2021 Strategic Development Program to the investment community.
The Program provides for hydrocarbon extraction over a 10-year period (2012-2021) amounting to 10 billion barrels of oil equivalent (BOE), with the average annual hydrocarbon extraction increment rate exceeding 3.5%.
The new program focuses on increasing the investment appeal and a dramatic growth of payments to shareholders. Thus, the dividend payments are expected to increase by 25% in 2012 y-o-y. In the foreseeable future, the growth of dividend payments may be many-fold compared with those in 2011. The growth of dividend payments will be covered by the growing cash flows due to the great appeal of investment projects. The CAPEX program is planned to exceed USD 150 billion by 2021, while about 16% of the funds are to be allocated to the Refining & Marketing business segment.
By 2021, LUKOIL is planning to increase its hydrocarbon production levels by 50% compared with 2011, thus reaching 1.17 billion BOE, while 17% of the output is expected to come from the Company’s international projects. A strategic goal, LUKOIL emphasized, is to raise the oil recovery factor to 40%.
The gas share of the Company’s overall hydrocarbon extraction is expected to reach 27% by 2021. The Company intends to reach the target associated petroleum gas utilization level of 95% by the end of 2014.
The Company also intends to enhance the refining quality and increase the conversion rate; the Russian refineries of the Group intend to increase the yield of light petroleum products to 72% by 2021. The Company plans to increase the daily average sales volume at the Russian filling stations of the Group by 27%.
An increase in the production and economic efficiency along with sustainable development of the Company are considered primary objectives of the Company’s 2012-2021 Strategic Development Program.
The presentation of the Company’s 2012-2021 Strategic Development Program will be available at LUKOIL’s website www.lukoil.com shortly.
Forward-looking Statements
Some statements of this press release are not historical facts, but rather represent expectations or forecasts of future events. Such statements among other things refer to forecasted or expected incomes, revenues (losses), earnings (losses) per share, dividends, capital structure, other financial indicators and rates; statements pertaining to our plans, goals and objectives, including those related to products and services; statements pertaining to future economic indicators; and statements pertaining to assumptions for such statements. Such terms as “anticipate”, “expect”, “suppose”, “plan”, “intend” and “predict” and other words with similar meaning are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and risks exist that the predictions, forecasts, projections and other forward-looking statements will not be achieved. One should be aware that a number of important factors could cause actual results to differ significantly from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements regarding the future, including the option to carry out restructuring and expense reduction program. When relying on forward-looking statements, you should carefully consider the foregoing factors and other uncertainties and events, especially in light of the political, economic, social and legal environment in which we operate. Such forward-looking statements speak only as of the date on which they are published and the Company does not undertake any obligations to update or revise any of them, whether as a result of new information, future events or otherwise. We do not make any representation, warranty or prediction that the results anticipated by such forward looking statements will be achieved, and such forward-looking statements represent, in each case, only one of the many possible scenarios and should not be viewed as the most likely or standard scenario.