At the meeting held on February 27, the Board of Directors of JSOC Bashneft discussed the progress of the action plan for monitoring the Company’s key material flows.

The plan was launched at the end of 2010. It is aimed at minimizing losses during production, transportation and storage of oil, improving the accuracy of measuring commercial and interplant raw material, semi-finished and end product flows, increasing the transparency of cost accounting. In 2011, Bashneft’s investments in projects aimed at the development of oil and petroleum products reporting systems exceeded 1.3 billion rubles.

Under the program of retail chain development and the adoption of new corporate style by JSOC Bashneft, the Board of Directors approved the concept of exterior design of filling stations and the schedule of filling stations rebranding activities. In 2012–2015, the Company’s investments in the rebranding of its filling stations are expected to amount to 3.7 billion rubles.

The Board of Directors also examined and approved the Company’s functional strategy on HR management. Bashneft’s policy in this area involves attracting, developing and retaining key employees who contribute to the Company’s shareholder value. At present, Bashneft and all its subsidiaries are successfully implementing the principal modern HR processes, such as the system of recruitment, employee training and development, and incentive programs.

The Company’s main strategic objectives in HR are to satisfy the need for highly qualified specialists by developing the Company’s internal talent pool, training young specialists and working with students, as well as to create a comprehensive incentive program and improve the employees’ performance.

The agenda of the Board meeting also included a number of other issues. The Board approved a number of transactions forming part of the Company’s current operations; approved the report on the results of series 04 corporate bonds issue; considered the report on compliance with the standards of the Code of Corporate Conduct, the Code of Ethics and the Anti-corruption Policy of JSOC Bashneft.