MOL shareholders approve proposal to pay first dividend since 2008

The dividend fund comes to HUF 45 billion.


MOL last paid a dividend on 2007 profits.


The dividend is in line with MOL's earlier announced policy of paying shareholders 40% of earnings, excluding one-off effects.


Shareholders approved MOL's consolidated IFRS report showing net income of HUF 154 billion and total assets of HUF 4,993 billion. Calculated with Hungarian Accounting Standards, the company had net income of HUF 150 billion and total assets of HUF 3,168 billion.


Shareholders with 67.9% of voting rights in the company were represented at the meeting.

CEO József Molnár told shareholders MOL would speed up investment programs in order to ensure continued growth in the upstream segment. He added that it would place bigger emphasis on Russia, Kazakhstan and Iraq's Kurdistan region, while continuing activities in the CEE region.


He said the upstream segment would be affected by the loss of Syrian production this year, while the downstream segment would be affected by the substantial excess refinery capacity in Europe. He added that the loss of production in Syria last year cost the company about half a billion dollars.


He said MOL's production levels were expected to remain unchanged in 2012-2014, then rise 3-4% from 2014. He added that MOL would start drilling nine wells in Kurdistan as well as make developments in Russia and the CEE region from 2014.


He put MOL's maximum annual CAPEX at $2 billion in 2012-2014.


He said MOL is conducting gas exploration in the Derecske Basin (E Hungary) and expects to see increased production from the area in 2015-2017.


The AGM mandated the board to buy treasury shares up to 25% of registered capital over the next year and a half.


The meeting re-elected Mr Molnar to the board with a mandate from October 12, 2012 until May 31, 2017.


The shareholders chose Ernst and Young as the company's auditor for 2012.


Chairman-CEO Zsolt Hernádi said at a press conference after the meeting that MOL was ready to sell its stake in the project company established to plan an build the Nabucco pipeline. He said MOL had indicated its reservations concerning the project since 2010, but received no response, thus the company decided to discontinue financing for the project.


The group has so far spent €20 million on the Nabucco pipeline project which will bring gas from Central Asia to Europe, reducing the region's energy dependency on Russia.


Molnár said MOL had not been the only company to criticize the project company as the project failed to adapt to changed circumstances. He added that there was hardly anybody today who could say what the project was and how much it would cost.


He said MOL had informed the other shareholders of its reservations and consulted with the Hungarian government as well.


MOL remains interested in seeing the construction of alternative gas pipelines and it supports the security of supply, which is also important to the government, he said. The government continues to support the work of the Nabucco, and it the pipeline is built, there will be no nothing in the way of its path through Hungary, he added.