Rosneft is the largest oil and gas company in Russia and the world's largest public oil and gas Company in terms of hydrocarbon reserve and liquid hydrocarbons production. One of the Company’s key priorities is increasing the resource base. Rosneft’s share in the Russian oil production reaches 40%, and over 5% of the world production.

At year-end 2016, the Company set another record in hydrocarbon production, having recovered over 265 million ton of oil equivalent, which is 4.3% above the 2015 level. The integration of Bashneft contributed to the growth of total oil production, along with the launch of new fields and enhanced efficiency of mature fields, mostly due to the work of the Company’s own service entities. The production of liquid hydrocarbons in 2016 amounted to 210.0 million ton.

In order to increase the efficiency of reserves extraction in Western Siberia, the Company performed a large-scale optimization of existing development systems by switching from traditional directional wells to horizontal wells with multi-stage hydraulic fracturing (HW with MSFrac). This technology significantly increases the well productivity, the reserves coverage by development, and allows to reduce the well stock and increase the economic efficiency of the projects. HW with MSFrac are actively applied at five consolidated mature Company enterprises: Yuganskneftegaz, Purneftegaz, Samotlorneftegaz, Nyaganneftegaz and Varioganneftegaz. In 2016, about 50% of the reserves involved in the development at these enterprises were put under production precisely due to the application of HW with MSFrac development systems. The approaches and technology applied by Rosneft for the development of West Siberian fields secured the Company’s leadership in efficient commissioning of new wells.

In 2016, the Company commissioned 2625 new wells (+43% above 2015). The pace of the well stock reconstruction was also increased due to the application of the sidetracking method. In 2016 the number of these operations increased by 5%, as compared to 2015. This allowed the Company to produce extra 2.9 million tons of oil upon the well stock reconstruction. Rosneft continues to increasingly implement more efficient completion methods on the new wells. The commissioning of horizontal wells with multi-stage hydraulic fracturing in 2016 increased by 56%, as compared to 2015. In general, the commissioning of wells with horizontal completion increased by 52%, as compared to 2015, and amounted to 32% of the total number of wells commissioned.