Galnaftogaz has conducted a scheduled conference call with investment community on 3Q 2009 results

The main messages brought to attention were:

∙ Physical sales through retail FS network as well as revenues in 3Q 2009 remained almost at the same level as in the respective period of 2008;
∙ Galnaftogaz generated EBITDA in 3Q 2009 in UAH terms by 44.8% higher compared with 3Q 2008;
∙ Daily average fuel throughput per 1 FS in 3Q 2009 fell by 14,7% in comparison with 3Q 2008 due to economic downturn and flow of customers to small wholesale segment. Recent data shows, that retail sales of oil products have started to recover - daily average fuel throughput per 1 FS in Oct-Nov 2009 is less by 3.8% only compared to the respective period of 2008;
∙ All CAPEX needs during 3Q 2009 were financed from long-term borrowings, while the major part of proceeds from operating activities was used to finance working capital;
∙ During 3Q 2009, as well as during previous quarters of 2009, the company suffered price competition on the retail oil products market mainly from it’s main player;
∙ Major part of the company’s debt is USD denominated long-term investment facilities, which are LIBOR linked. Current low LIBOR indications help to compensate high interest payments because of local currency devaluation;
∙ The company has strengthened its position both in terms of EBRD equity contribution and disbursement of the rest (USD 65 mln) of USD 200 mln EBRD/IFC investment facility and now can appropriately react on aggressive price competition;
∙ Galnaftogaz will be carefully monitoring M&A market in order to identify acquisition opportunities of small networks preferably in cities with population of more than 1 mln. In relation to construction of FS’s, the company will be selectively and moderately constructing FS’s on business attractive land plots.