Regular meeting of Board of Directors of Tatneft Oil Company was held at the Government House of the republic

On April 27, Tatarstan President Rustam Minnikhanov held a regular Board meeting of Tatneft Oil Company.

One of the main issues on the agenda was the discussion of the results of financial and operational activities of the company in 2016 and the approval of recommendation on the amount of dividends for 2016.

The implementation of the Strategy of Development of Tatneft Company, which aims at doubling the company's value in US Dollar terms by 2025 started last year. The Strategy 2025 has set goals and tasks for all business areas of Tatneft Group, and allows to forecast operational, investment and financing activities more effectively. Based on the Strategy 2025 implementation plans – investments required to support and grow the production, human capital development, including the fulfillment of all social commitments, efficiency improvement initiatives, procurement of sustainable development, as well as taking into account substantially decreased leverage and accumulation of cash in the prior periods, the Board resolved to recommend to the Annual General Meeting of Shareholders of Tatneft to be held on 23 June 2017 to approve the dividends on ordinary and preferred shares of the Company in the amount of 2281 per cent of their par value, which in aggregate makes approximately 50 per cent of Tatneft’s IFRS profit for 2016 or 50.62 per cent of net income according to the Russian Accounting Standards (RAS).

For many years the company has been paying dividends making approximately 30 per cent of its annual RAS net income, providing steady and relatively high dividend yield to its shareholders. The dividend payout increase stimulates the effective implementation of the Strategy 2025, while increasing the responsibility for achievement of the goals set by it.  The senior managers will continue working on the company's financial strategy and related modifications to its dividend policy, which will be submitted to the Board for approval.

In total, in 2016 the companies of Tatneft Group produced 28.686 million tonnes of crude oil (which is 5.3 per cent more than in 2015), including 28.333 million tonnes by Tatneft (which is 5.2% higher than the 2015 level).

The Board discussed the process of increasing the wells grid density in some pilot sites of the company, and the potential for increasing crude oil production by involving larger reserves from the Carboniferous formations. 

The Board also summed up the results of the company's fulfilment of the first quarter budget and approved the budget for May 2017, heard the information about the Annual General Shareholders Meeting and considered some other items related to the company's activities.