DEVELOPMENT
STRATEGY

• OUR VISION

  Embamunaigas JSC is a highly efficient oil and gas Company with majority state interest, meeting the highest safety standards, with highly qualified personnel and a profitable resource base ensuring long-term development.

• OUR MISSION

  We produce oil and gas in order to ensure stability for employees and efficiency for the shareholder by balancing social and business interests well.

OUR VALUES

Human life is our absolute value. Ensuring the safety of life and health of our employees through the introduction of a safety culture for themselves and their colleagues. An employee who comes to work must return home safe and sound.

Making it through. The Company is committed to achieving the stated results and goals. We value result-motivated employees.

Careful attitude to the motherland and the Company. The Company appreciates the environmentally friendly employees and those taking care of the Company’s assets.

Expertise. The Company creates conditions to improve the expertise of its employees. We value employees seeking to acquire new knowledge and create equal conditions for career growth.

Ethics and respect for the individual. The Company is committed to creating a culture of relations based on mutual respect and trust.

• Profitability

  as an essential condition for the existence of the Company.

• Social stability

  Ensuring the employment of the Company’s employees through the rational distribution of staff for current and new projects.

• Environment

  Rational use of subsoil and reduction of adverse environmental impact. With the growth of production, the Company is introducing new technologies that reduce the adverse environmental impact.

• Energy efficiency

  When choosing technologies for new and existing projects, the Company will give priority to the use of energy efficient technologies.

• Automation of production

  Improving performance and occupational safety

STRATEGIC LINES
OF ACTIVITIES

The priority line of activities of the Company is the formation of a competitive resource base supporting the stable and long-term (more than 25 years) development of Embamunaigas JSC to provide employment and create shareholder value through:

• • conducting exploration operations under existing and new contracts

• • conducting additional exploration at existing fields, and acquiring new assets.

The implementation of the Development Concept of Embamunaigas JSC will allow the Company to make a significant contribution to the economic development of the region and confidence in the future for a team of many thousands (over 5,000 employees).

STRATEGIC INDICATORS

KPI	UoM	2017 (ACTUAL)	2018 (PLAN)	2018 (ACTUAL)	2022 (PLAN)	2027 (PLAN)	2032 (PLAN)
Reserves	mln tonnes	70,4	75,49	74,30	202,64	184,68	146,24
Production output	mln tonnes	2,8	2,9	2,9	3,99	3,15	11,3
Lifting costs	mln tonnes	186,96	210,35	200,25	405,18	483,26	1 749,05
Headcount	ppl	5 275	5 439	4 942	5 341	5 341	5 341
ROACE	%	17,92%	13,60%	26,71%	>WACC	>WACC	>WACC
EBITDA	mln USD	283,8	259,6	337,7	384,1	248,3	1 840,7
EVA	mln USD	62,9	22,3	139,21	>0	>0	>0

KEY RISKS

The Company has identified the following key risks in implementing the Development Concept and risk mitigation measures:

#	Factors	Potential impact	Mitigation measures
1	Decreased production at fields that are in thefinal stages of development due to the high costof production	Reduced production volumes	Increased reserves due to exploration operations and M&A transactions
2	The high level of geological risks due to the depth of the promising layers of the P-1 project	Decreased Company’s value	A strategic partner recruitment
3	Reduced investment potential for financing projects due to the shareholder withdrawing a significant amount of dividends	No increase in reserves and production rates	The Concept approved by the shareholder (including the investment and dividend policies) as well as business plans for investment projects
4	Reduced oil prices (below baseline)	Reduced Company’s earnings	Search for business cost reduction initiatives