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President of Russia Vladimir Putin: Mr Sechin, there is no need to describe Rosneft, since it has truly become one of the world’s oil and gas industry leaders. A lot has been done lately to consolidate the company. A portion of the company's shares went private, you now have strategic investors who have assumed certain commitments to develop the company and organise the sale of oil and petroleum products. In a word, the company is expanding.

I am aware that a general shareholders’ meeting will be held in a few days, so I would like to ask you to discuss a number of issues related to high technology, digital technology, the latest production techniques and, most importantly, changes on the international market.

You are among the participants in the process of coordinating the positions between our largest companies, and the Government, and, in turn, this is how we formulate our position with regard to our partners on the international oil market.

As a matter of fact, Rosneft participates in developing these decisions. You are aware of what is happening on the international market, so a new corporate strategy should be developed based on your knowledge. Of course, I would like to ask you to get back to the fiscal issues, namely, to paying 50 percent of the dividends based on net revenue.

These and other issues will need to be discussed with your colleagues during the upcoming meeting.

Rosneft CEO, Chairman of the Management Board and Deputy Chairman of the Board of Directors Igor Sechin: Mr President,

We have carefully studied the instructions you issued at the St Petersburg [International Economic] Forum. Of course, we will use the upcoming general shareholders’ meeting and the board of directors meeting, which will follow the general meeting, to raise all the issues related to our response to the volatility on the international markets, strengthening the company's position in light of improving its efficiency and reducing costs, using advanced technology, such as digital material management technologies, supply chain management, and overhauling accounting systems across all areas of business pursued by our company.

We signed a relevant technology transfer agreement with General Electric several days ago and hope it will have a major impact. We will have to make some adjustments in corporate strategy.

We will use everything that is aimed at boosting efficiency and adopting cutting-edge technology in oil production and processing to approach the premium customer markets such as petrochemistry.

We will draft instructions and a new corporate strategy to deal with the challenges we are facing.

Vladimir Putin: Please tell us about the new deposit.

Igor Sechin: Mr President, we would like to thank you. You gave us the command to start working at the Khatanga licensed site. Here are the first results of this work. (Core sample is shown.) Please be careful – the core is oil-saturated. It is filled with oil and even has oil staining. This core is unique for our deposits. We made a tentative analysis and its high hydrocarbon content and productive bed thickness allow us to report to you, Mr President, that we are about to discover a very rich deposit.

We brought this core from a depth of 2,300 metres. Our task is to continue research to a depth of 5,000 metres in order to explore Lower Permian beds. Today our geologists are saying these will be unique deposits. According to preliminary technical studies in the Laptev Sea area, they may contain up to 9.5 billion tonnes of geological resources. This requires a serious effort. We hope you will follow up on our work and we will report to you on new results as they come along.

Vladimir Putin: All right.

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