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Based on the results for 2012, NIS will again be one of the most successful companies not only in Serbia, but in the whole territory of former Yugoslavia, as the NIS Chief Executive Officer, Mr. Kirill Kravchenko said. Mr. Kravchenko addressed the issue of improving the quality of fuel produced in Pancevo Oil Refinery, amount of money NIS paid in the Serbian budget, as well as the issue of new regional projects in the interview given for daily papers “Vecernje novosti”. Mr. Chief Executive Officer, what will happen to the quality of fuel produced in Pancevo Oil Refinery? Fuel produced at Pancevo Oil Refinery at the moment meets all the standards prescribed in the Republic of Serbia. The quality of fuel in all phases, starting from the refinery all the way to a PS is subject to continuous supervision of laboratories and independent state inspectors. As of 1 November 2012, after the start-up of MHC/DHT plant, the Company has completely switched to the production of fuel that will meet the strictest standards – Euro-5. I am sure that we will get the European certificate by the end of 2012 which certifies that Pancevo Oil Refinery produces high quality fuel and that all the quality-related issues will be thus eliminated. What did the Company do to start the production of the European quality fuel? As I have already mentioned, a definite switch to production of Euro-5 fuel in Pancevo Oil Refinery will be possible only after the start-up of MHC/DHT plant on 1 November. We have fulfilled our promise made in 2009 – the modernization of the processing complex that lasted for more than two years was completed and it was worth of more than 500 million Euro. From now on, Serbia can supply both the national market with high quality Euro-5 fuel from its own resources and export petroleum products to the regional countries, in particular to Bosnia and Herzegovina, Bulgaria and Romania. I would like to point out that the modernization will not end with this. The feasibility study for the second phase of modernization of Pancevo Oil Refinery should be completed soon and we intend to build the capacities for heavy residues processing whose value could be compared with the MHC/DHT complex. I would like to make a special remark about Novi Sad Refinery where the construction of base oils plant worth of around 100 million Euro will start in 2013. Are the NIS investments dedicated only to processing? Investments in the Company’s development are one of our business priorities and as of the beginning of 2009 more than 1,5 billion Euro has been invested in NIS. We have several priority directions which we consider important not only for NIS, but for Serbia as a whole. They include the expansion of our business in the region in production and retail segments. As for the production, we have active business operations in BiH, Romania and Hungary, and we also analyse other countries of the Pannonian Basin countries. Our second priority is the retail network development, both in Serbia and abroad. In order to enhance our capacities for trading with high-quality fuel, during 2012 we actively constructed retail networks in Bosnia, Bulgaria and Romania, and we expanded logistic infrastructure. I am sure that drivers in those countries will soon and with pleasure buy high-quality fuel produced in Serbia. Active NIS operations outside Serbia do not mean only the possibility for Serbian producers to appear in new markets but also the increase of export-related inflow, new jobs, additional funds in the state budget, increase of Serbia’s influence in the region. What is your evaluation of the Company’s performance for the nine months? First of all, we may speak about increase in investments – this figure is increased by 62% versus the same period in 2011, and the total amount of investments made in the Company’s development is 30,35 billion RSD. The same applies to budget contributions – they increased by 7% versus the same period of nine months in 2011, and amounted to 55,9 billion RSD. Based on the results for 2012, the amount of around 94 billion RSD will be paid to the Serbian budget. Please note that NIS is one of the biggest contributors to the Serbian budget on whose stability million of budgetary beneficiaries and pensioners depend. We would also like to emphasize the fact that NIS has been a stable source of income for the Serbian budget. In addition to that, we actively finance a series of social programs to include – regional cooperation and a series of humanitarian projects. The Company actively executes the strategy of strengthening regional markets; it has introduced an actively implements a new PS brand – «tricolour brand». Taking account of a complex economic situation in Serbia, we may say that we have achieved a positive trend in the last nine months, which is particularly important in the present economic crisis conditions. NIS achieved net profit in the amount of 32,2 billion RSD in this period, which is by 18,6 percent more than the last year’s indicator. EBITDA was increased – in September 2011 it amounted to 32,3 billion RSD and in early October 2012 the figure increased to 48,1 billion RSD. We have succeeded in increasing operating cash flow (OCF) volumes to 27,4 billion RSD. The production segment has a positive trend as well – we increase both the volumes of produced oil and gas, and the volumes of reserves whose continuous growth represents a guarantee for the Company’s stability. Decrease in processing volume can be explained by technical reasons – Pancevo Oil Refinery operations were stopped twice both due to the scheduled work-over and due to integration of MHC/DHT complex to the Company’s infrastructure. Fuel sale has been little reduced due to the crisis, but a flexible pricing policy and increase of service quality in our PSs have resulted in the increase of retail sales volume by 33,7 thousand of tons in the period between January and September of this year. What do you think about petroleum products prices and their potential decrease? This is a very hot issue in today’s economic circumstances. As of 2011, the Serbian market of petroleum products has been completely open and prices are set in accordance with regional trends and a series of other factors. These factors include – local currency stability, citizens’ earnings, the state’s share in fuel price structure, development degree of traffic infrastructure in the country. Generally speaking, NIS has followed the regional trend of price increase, but we were very flexible in relation to the possibility for their decrease, taking into account the situation in the country. We can indirectly affect the price because NIS is a vertically integrated country and we manage to take this advantage, even in spite of excise tax increase, in order to maintain the prices at the level lower than average prices in the region. Given the fact that the Serbian market of petroleum products has shrunk, and our share and retail sales volume in it has increased compared to the same nine months in 2011, we may say that we pursue a good direction. I am sure that after the start-up of renovated Pancevo Refinery we will have additional potential for even more operational adjustments to retail fuel prices.