MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS You should read the following discussion and analysis of our financial condition and results of operations as of 30 June 2017 and for the six months then ended (hereinafter referred to as MD&A ) in conjunction with our unaudited consolidated interim condensed financial information as of and for the six months ended 30 June 2017 (hereinafter referred to as the consolidated interim financial information ). The consolidated interim financial information has been prepared in accordance with International Accounting Standard ( IAS ) 34 Interim Financial Reporting. The financial and operational information contained in this MD&A comprises information on PAO SIBUR Holding and its consolidated subsidiaries (hereinafter jointly referred to as we, SIBUR, Company or the Group ). SELECTED DATA (1) Operating Results The following table presents the Group s key operational measures for the six months ended 30 June 2017 and 2016: Thousand tonnes, except as stated 2017 2016 Processing and production volumes APG processing (2) (million cubic metres) 10,949 10,911 0.4 APG processing, SIBUR's share (3) (million cubic metres) 10,692 10,668 0.2 Natural gas production (2) (million cubic metres) 9,518 9,464 0.6 Natural gas production, SIBUR's share (3) (million cubic metres) 9,322 9,277 0.5 Raw NGL fractionation (4) 4,148 3,632 14.2 Raw NGL fractionation, SIBUR s share 3,548 3,294 7.7 Sales volumes Natural gas (million cubic metres) 8,922 8,867 0.6 LPG 2,210 2,186 1.1 Petrochemical products, including 1,842 1,707 7.9 PP 278 258 7.7 PE 132 114 16.7 Elastomers 238 229 4.3 Plastics and organic synthesis products 405 400 1.2 (1) In this and other tables of this MD&A, immaterial deviations in the calculation of percentage changes, subtotals and totals are explained by rounding. (2) Including Gazprom Neft s share in the processing / production volumes of Yuzhno-Priobskiy GPP. (3) Excluding Gazprom Neft s share in the processing / production volumes of Yuzhno-Priobskiy GPP. (4) Including fractionation volumes under processing arrangements. 1

Financial Results The following table presents the Group's key financial measures for the six months ended 30 June 2017 and 2016: RR millions, except as stated 2017 2016 Income statement highlights Revenue (net of VAT and export duties) 211,944 196,124 8.1 Adjusted EBITDA (1) 78,919 70,408 12.1 EBITDA 75,157 65,380 15.0 EBITDA margin, 35.5 33.3 EBITDA of reportable segments Feedstock & Energy 35,156 24,427 43.9 Olefins & Polyolefins 24,030 25,510 (5.8) Plastics, Elastomers & Intermediates 18,118 18,013 0.6 Profit for the reporting period 65,826 63,273 4.0 Cash flow highlights Net cash from operating activities, including 63,291 59,865 5.7 Cash generated before income tax payment 75,339 65,341 15.3 Net cash used in investing activities, including (29,413) (85,524) (65.6) Capital expenditures (2) (48,713) (84,861) (42.6) Proceeds from disposal of subsidiary, net of cash disposed 22,136 - n/m Net cash used in financing activities, including (52,933) (80,023) (33.9) Dividends paid to SIBUR shareholders (9,367) (7,058) 32.7 Net repayment of debt (36,382) (53,775) (32.3) As of 30 June 2017 As of 31 December 2016 Key ratios Net debt (3) / EBITDA 1.7x 2.0x EBITDA / Interest (4) 9x 6x The first half of 2017 was marked by recovering oil prices with Brent gaining 30.4 year-on-year and averaging 51.8 USD per barrel. This dynamics was picked up by LPG and naphtha international market prices. Prices for petrochemical products also demonstrated growth, however of a smaller magnitude, which resulted in tighter spreads for petrochemicals overall. Russian rouble reacted to higher oil prices with appreciation of 21 year-on-year on average. These changes had a net positive impact on SIBUR results with EBITDA up by 15.0 to RR 75,157 million year-on-year. This growth was almost fully attributable to the Feedstock & Energy segment, while our petrochemicals businesses encountered higher intragroup feedstock costs, which was compensated by higher selling volumes. In the first half of 2017, our APG processing volumes remained flat at 10.7 billion cubic metres and our raw NGL fractionation volumes increased by 7.7 year-on-year to 3.5 million tonnes. Additionally available volumes of LPG and naphtha were fully utilised internally by our petrochemicals businesses and we increased sales of polypropylene by 7.7 and sales of polyethylene by 16.7 year-on-year. In the first half of 2017, our revenue increased by 8.1 year-on-year to RR 211,944 million from RR 196,124 million in the first half of 2016 with the following dynamics across the segments: (i) (ii) Feedstock & Energy segment revenue increased by 2.3 to RR 79,276 million from RR 77,505 million due to higher international benchmark prices for liquids, which was largely offset by RR appreciation and lower external sales volumes of liquids on lower raw NGL purchases; Plastics, Elastomers & Intermediates revenue increased by 14.4 to RR 76,192 million from RR 66,614 million; this segment made the highest contribution to the total revenue growth mainly due to the favourable market environment for elastomers in the first half of 2017; (1) EBITDA adjusted for the respective portion of EBITDA of joint ventures and associates. (2) Includes purchase of property, plant and equipment, intangible assets and other non-current assets. (3) Net debt represents total debt less cash and cash equivalents. (4) Interest represents accrued interest, i.e. includes interest expense and capitalised interest. 2

(iii) (iv) Olefins & Polyolefins revenue was flat at RR 42,634 million year-on-year as higher revenue from PP and PE sales on increased volumes was offset by lower revenue from BOPP-films on lower prices; Unallocated revenue increased by 45.5 to RR 13,842 million from RR 9,515, which was attributable to NIPIGAZ operations with the respective reflection in operating expenses under goods for resale, as well as higher revenue from power and electricity sales following the acquisition of Tobolsk HPP in February 2016. In the first half of 2017, our EBITDA increased by 15.0 to RR 75,157 million from RR 65,380 million. The growth was fueled by the strong performance of the Feedstock & Energy segment, which EBITDA increased by 43.9 to RR 35,156 million from RR 24,427 million inter alia due to higher netbacks for LPG and naphtha. The growth was somewhat negated by weaker EBITDA of our petrochemicals businesses due to tighter spreads. The joint contribution of our Olefins & Polyolefins and Plastics, Elastomers & Intermediates segments decreased by 3.2 year-on-year to RR 42,148 million from RR 43,523 million. Our net profit in the first half of 2017 increased by 4.0 to RR 65,826 million as compared to RR 63,273 million in the first half of 2016. This was attributable to higher operating profit and gain on disposal of Uralorgsintez partially offset by lower foreign exchange gain due to immaterial movements in currencies within the first half of 2017 as opposed to the same dates of 2016. For a detailed discussion on SIBUR s operational and financial performance see Results of Operations and Liquidity and Capital Resources. The following table provides a reconciliation of Adjusted EBITDA to profit for the six months ended 30 June 2017 and 2016: RR millions 2017 2016 Adjusted EBITDA 78,919 70,408 Portion of EBITDA of joint ventures and associates 3,762 5,028 EBITDA 75,157 65,380 Net finance income 3,124 25,209 Gain on disposal of subsidiary 19,805 - Gain on acquisition of subsidiary - 2,356 Share of net income from joint ventures and associates 529 3,666 Depreciation and amortisation (17,530) (17,123) Reversal/(accrual) of impairment of property, plant and equipment 212 (341) Income tax expense (15,471) (15,874) Profit for the reporting period 65,826 63,273 3

OVERVIEW SIBUR is a uniquely positioned vertically integrated gas processing and petrochemicals company. We own and operate Russia s largest gas processing business in terms of associated petroleum gas and raw natural gas liquids processing volumes and are a leader in the Russian petrochemicals industry. In 2016, SIBUR introduces new segment reporting with petrochemicals segment split in two segments. Purely energy products were retained within the Feedstock & Energy segment, while MTBE and fuel additives were moved to the new Plastics, Elastomers & Intermediates segment. Comparables for the first half of 2016 have been changed to match the new breakdown. SIBUR has three operating and reportable segments: Feedstock & Energy segment comprises (i) gathering and processing of associated petroleum gas (APG) that we purchase from major Russian oil companies, (ii) transportation, fractionation and other processing of natural gas liquids (NGLs) that we produce internally or purchase from major Russian oil and gas companies, and (iii) production, marketing and sales of energy products, such as natural gas, liquefied petroleum gases (LPG) and naphtha. We sell these energy products on the Russian and international markets and use some of them as feedstock for our petrochemicals segments. Olefins & Polyolefins is a petrochemicals segment that produces polyolefins, such as polypropylene and polyethylene, BOPP-films, olefins comprising propylene and ethylene, which are used internally by our petrochemicals segments and sold externally (primarily sales of ethylene to RusVinyl). Plastics, Elastomers & Intermediates is a petrochemicals segment that produces a variety of petrochemical products, such as (i) plastics and organic synthesis products comprising PET, glycols, expandable polystyrene, alcohols and acrylates, (ii) elastomers comprising various grades of commodity and specialty rubbers and thermoplastic elastomers, (iii) methyl tertiary butyl ether (MTBE) and fuel additives, which are sold externally. The segment also produces intermediates, which are primarily used internally with a minor share being sold to the market. As of 30 June 2017, SIBUR operated 23 production sites across Russia and employed over 27,000 personnel (1). (1) Excluding the personnel of non-consolidated joint ventures. 4

RECENT DEVELOPMENTS In May 2017, the shareholders of the Company elected members to the Board of Directors at the Annual General Meeting, including a representative of the Silk Road Fund, a new shareholder of SIBUR. Ms. Wang Dan, Executive Vice President of the Silk Road Fund, joined SIBUR Board of Directors. In April 2017, the Company was notified of several transactions resulting in changes in the shareholding structure: OOO Trust acquired 17 of the Company s shares from OOO Yauza 12 and increased its stake in OOO OleFinInvest, the owner of 34.08 of the Company s shares, up to 99.9; Gennady Timchenko exited from OOO OleFinInvest having received his stake in the Company into direct ownership, and further increased it by 2.7. In April 2017, SIBUR completed the sale of its SIBUR GEOSINT production site in Kemerovo to TehPolimer Group, one of Russia s largest geosynthetics producers. SIBUR GEOSINT produces materials from the special grade of virgin polypropylene. The transaction was executed in line with SIBUR's strategy to prioritise the development of bulk polymer production. Results of SIBUR GEOSINT were reported under Other Sales of PE&I segment. Plastik-Geosintetika, SIBUR GEOSINT s facility in the town of Uzlovaya, will, however, remain part of SIBUR. In April 2017, SIBUR has closed the sale of a 100 stake in Uralorgsintez to EKTOS, a leading Russian producer of high-octane fuel components. Uralorgsintez is located in Tchaikovsky and focuses on the production of liquefied petroleum gas (LPG) and methyl tertiary butyl ether (MTBE), a high-octane fuel component from hydrocarbons. Its hydrocarbon fractionation capacity stands at 0.91 mtpa, MTBE production capacity at 220 ktpa, and benzene production capacity at 95 ktpa. As part of the transaction, the companies signed a number of long-term agreements, including processing and supply agreements with guaranteed capacity utilisation of Uralorgsintez s core facilities. In February 2017, Moody s changed to Stable from Negative the outlook on the Ba1 SIBUR rating. In January 2017, the Silk Road Fund ( SRF ), a Chinese investment fund, completed the acquisition of a 10 stake in SIBUR. 5

SELECTED MACROECONOMIC AND MARKET DATA GDP Growth The following table contains selected data on year-on-year GDP growth for the six months ended 30 June 2017 and 2016: 2017 2016 European Union (EU-15) 2.0 1.7 United States 2.0 1.8 China 6.9 6.7 Russia 1.6 (0.5) Source: Eurostat, U.S. Bureau of Economic Analysis, National Bureau of Statistics of the People's Republic of China, Russian Federal State Statistics Service Foreign Exchange Rate Fluctuations The following table presents selected data on exchange rate movements for the six months ended 30 June 2017 and 2016: 2017 2016 RR/USD rate at the end of the preceding period 60.6569 72.8827 RR/USD rate at the end of the reporting period 59.0855 64.2575 Average RR/USD rate 57.9862 70.2583 RR/EUR rate at the end of the preceding period 63.8111 79.6972 RR/EUR rate at the end of the reporting period 67.4993 71.2102 Average RR/EUR rate 62.7187 78.3669 Source: CBR Inflation The following table presents selected data on inflation rates for the six months ended 30 June 2017 and 2016: 30 June to 30 June 2017/2016 2016/2015 Consumer price index (CPI) 4.4 7.5 Producer price index (PPI) 2.9 5.7 Source: Russian Federal State Statistics Service Market Prices for Energy Products The following table presents average benchmark international market prices for crude oil, naphtha and LPG for the six months ended 30 June 2017 and 2016: USD per tonne except as stated 2017 2016 Brent crude oil (USD per bbl) 51.8 39.7 30.4 Naphtha (CIF NWE) 460.0 360.0 27.8 LPG DAF Brest 367.1 229.1 60.2 LPG Sonatrach for Bethioua 398.8 281.6 41.6 LPG Argus cif ara (large) 392.6 283.0 38.7 Source: Bloomberg, Argus Export Duties on LPG and Naphtha The LPG and naphtha (excluding pentane and isopentane) that we export are subject to export duties, which are set monthly by the Russian Government. Export sales to member states of the Customs Union (Republic of Belarus, Republic of Kazakhstan, Republic of Armenia and Kyrgyz Republic) are not subject to export duties. 6

The export duty on LPG (excluding butane and isobutane) is formula-based and depends on the international benchmark price of LPG (LPG DAF Brest). When the market price for LPG is below USD 490 per tonne, no export duty is levied. Effective 1 January 2015, the Russian Government imposed an export duty on butane and isobutane, which is calculated as the percentage of the export duty on LPG grades excluding butane and isobutene. It was set at 20 for 2016 and 30 for 2017 with successive annual increases up to 90 effective 1 January 2022. As the average LPG price for the export duty rate calculation was below USD 490 per ton in both reporting periods, we applied a zero export duty rate in respect of our LPG export sales. The export duty on naphtha is calculated as a percentage of export duties on crude oil (Urals). This rate was set at 71 and 55 of the crude oil export duty for 2016 and 2017, respectively. The decrease in export duty rates for naphtha is implemented as part of the tax maneuver in the Russian oil industry. The following table presents export duties on LPG and naphtha for the periods and as of the dates indicated:, Export duties, USD per tonne 2017 2016 H1 2017 / 2016 LPG excl. butane and isobutane At the end of the period 0.0 0.0 n/m Average for the period 0.0 0.0 n/m butane and isobutane At the end of the period 0.0 0.0 n/m Average for the period 0.0 0.0 n/m Naphtha (excl. pentane and isopentane) At the end of the period 44.0 57.2 (23.1) Average for the period 47.0 43.3 8.5 Source: Russian Government Natural Gas Prices In 2016 and during the first half of 2017, wholesale natural gas prices for sales to all customer categories (excluding residential customers) on the domestic market remained unchanged. Effective 1 July 2017, the Federal Anti-Monopoly Service (FAS) increased wholesale natural gas prices for sales to all customer categories (excluding residential customers) on the domestic market by 3.9. The increase in the wholesale natural gas prices corresponded to the main parameters of the Forecast of Socio-economic Development of the Russian Federation for 2017 and planned period 2018 and 2019 prepared by the Ministry of Economic Development of the Russian Federation and published in November 2016. The forecast envisages an increase in wholesale natural gas prices for sales to all customer categories (excluding residential customers) from 1 July 2018 and 2019 by 3.4 and 3.1, respectively. The Russian Federation government continues to discuss various concepts relating to the natural gas industry development, including natural gas prices and transportation tariffs growth rates on the domestic market. Railway Transportation Tariffs Effective 3 January 2016, FAS increased the railroad transportation tariff by 9. Effective 1 January 2017, the FAS increased the tariff by 4 with subsequent increase by 2 effective 9 January 2017. Effective 29 January 2015, Russian Railways implemented a 13.4 tariff surcharge for deliveries of all types of our products within the Russian Federation territory to the export markets. Effective 1 January 2017, Russian Railways ceased a 13.4 tariff surcharge for deliveries of oil derivatives to the export market. Effective 29 January 2017, Russian Railways set tariff surcharge at 10 for all types of products, while for LPG it came into effect on 12 February 2017 and was ceased for other types of oil derivatives products. 7

Electricity and Heat Tariffs The following table presents volumes purchased and effective average prices for electricity and heat tariffs for the six months ended 30 June 2017 and 2016: 2017 2016 Average Volume tariff Volume Average tariff Average Volume tariff Electricity (millions of kw hour or RR per kw/hour) 5,025 2.15 4,897 2.09 2.6 3.0 Heat (thousands of gigacalories or RR per gigacalory) 2,748 1,023 3,215 920 (14.5) 11.2 8

RESULTS OF OPERATIONS FOR THE SIX MONTHS ENDED 30 JUNE 2017 AND 2016 The following table presents selected data on our results of operations for the six months ended 30 June 2017 and 2016: RR millions, except as stated 2017 of revenue 2016 of revenue Revenue 211,944 100.0 196,124 100.0 8.1 Feedstock & Energy 79,276 37.4 77,505 39.5 2.3 Plastics, Elastomers & Intermediates 76,192 35.9 66,614 34.0 14.4 Olefins & Polyolefins 42,634 20.1 42,490 21.7 0.3 Unallocated 13,842 6.5 9,515 4.9 45.5 Operating expenses (154,105) (72.7) (148,208) (75.6) 4.0 Operating profit 57,839 27.3 47,916 24.4 20.7 Net finance income 3,124 1.5 25,209 12.9 (87.6) Gain on disposal of subsidiary 19,805 9.3 - - n/m Gain on acquisition of subsidiary - - 2,356 1.2 n/m Share of net income of joint ventures and associates 529 0.2 3,666 1.9 (85.6) Profit before income tax 81,297 38.4 79,147 40.4 2.7 Income tax expense (15,471) (7.3) (15,874) (8.1) (2.5) Profit for the reporting period 65,826 31.1 63,273 32.3 4.0 Profit for the reporting period, including attributable to: 65,826 31.1 63,273 32.3 4.0 Non-controlling interest 1,001 0.5 221 0.1 n/m Shareholders of SIBUR 64,825 30.6 63,052 32.1 2.8 Revenue In the first half of 2017, our revenue increased by 8.1 year-on-year to RR 211,944 million from RR 196,124 million in the first half of 2016 with the following dynamics across the segments: (i) (ii) (iii) (iv) Feedstock & Energy segment revenue increased by 2.3 to RR 79,276 million from RR 77,505 million due to higher international benchmark prices for liquids, which was largely offset by RR appreciation and lower external sales volumes of liquids on lower raw NGL purchases; Plastics, Elastomers & Intermediates revenue increased by 14.4 to RR 76,192 million from RR 66,614 million; this segment made the highest contribution to the total revenue growth mainly due to the favourable market environment for elastomers in the first half of 2017; Olefins & Polyolefins revenue was flat at RR 42,634 million year-on-year as higher revenue from PP and PE sales on increased volumes was offset by lower revenue from BOPP-films on lower prices; Unallocated revenue increased by 45.5 to RR 13,842 million from RR 9,515, which was attributable to NIPIGAZ operations with the respective reflection in operating expenses under goods for resale, as well as higher revenue from power and electricity sales following the acquisition of Tobolsk HPP in February 2016. For a detailed discussion on results in each operating segment see Segment Information. 9

Operating Expenses The following table presents a breakdown of our operating expenses for the six months ended 30 June 2017 and 2016: RR millions, except as stated 2017 of revenue 2016 of revenue Feedstock and materials 43,204 20.4 38,589 19.7 12.0 Transportation and logistics 32,326 15.3 37,457 19.1 (13.7) Staff costs 19,484 9.2 17,953 9.2 8.5 Energy and utilities 19,157 9.0 18,304 9.3 4.7 Depreciation and amortisation 17,530 8.3 17,123 8.7 2.4 Goods for resale 10,265 4.8 6,095 3.1 68.4 Services provided by third parties 5,002 2.4 4,960 2.5 0.8 Repairs and maintenance 3,219 1.5 3,363 1.7 (4.3) Taxes other than income tax 1,571 0.7 1,179 0.6 33.2 Processing services of third parties 1,517 0.7 1,012 0.5 49.9 Charity and sponsorship, marketing and advertising 819 0.4 763 0.4 7.3 Charity and sponsorship 443 0.2 519 0.3 (14.6) Marketing and advertising 376 0.2 244 0.1 54.1 Rent expenses 645 0.3 631 0.3 2.2 Loss on disposal of PPE 113 0.1 262 0.1 (56.9) Other 451 0.2 1,455 0.7 (69.0) (Reversal)/accrual of impairment of PPE (212) (0.1) 341 0.2 n/m in work-in-progress and refined products balances (986) (0.5) (1,279) (0.7) (22.9) Operating expenses 154,105 72.7 148,208 75.6 4.0 In the first half of 2017, our operating expenses increased by 4.0 year-on-year to RR 154,105 million from RR 148,208 million. The increase was primarily attributable to higher feedstock costs largely on higher international benchmarks for liquids, as well as an increase in purchases of goods for resale, which were also reflected in our revenues. These factors were partially compensated by the decrease in transportation and logistics costs largely on lower transported volumes of raw NGL following the expansion of fractionation capacity in 2016, as well as Russian rouble appreciation. Feedstock and Materials In the first half of 2017, our feedstock and materials costs increased by 12.0 year-on-year to RR 43,204 million from RR 38,589 million, increasing as a percentage of total revenue to 20.4 from 19.7 in the first half of 2016. The increase was driven by higher expenses related to purchases of hydrocarbon feedstock largely due to the increase in the respective export netbacks, partially compensated by Russian rouble appreciation and lower other feedstock & materials expenses. The following table presents information on our costs related to purchasing of feedstock and materials for the six months ended 30 June 2017 and 2016: RR millions, except as stated 2017 of feedstock and materials expenses 2016 of feedstock and materials expenses NGLs 16,264 37.6 11,193 29.0 45.3 APG 12,637 29.2 11,274 29.2 12.1 Paraxylene 3,587 8.3 3,478 9.0 3.1 Benzene 2,023 4.7 2,148 5.6 (5.8) Other feedstock and materials 9,836 22.8 12,908 33.4 (23.8) of stock (1,143) (2.6) (2,412) (6.3) (52.6) Feedstock and materials, total 43,204 100.0 38,589 100.0 12.0 In the first half of 2017, our expenses related to purchases of NGLs increased by 45.3 year-on-year to RR 16,264 million from RR 11,193 million, increasing as a percentage of total feedstock and materials expenses to 37.6 from 29.0. The increase in expenses was attributable to the growth in the effective average purchase price by RR 4,819 per tonne (76.7) largely on higher international benchmarks for liquids resulted in the respective export netbacks dynamics, which was only partially compensated by Russian rouble appreciation. This factor was partially offset by the decrease in purchasing volumes by 17.8 year-on-year mainly due to lower supplies from Gazprom on changes in their product mix, as well as lower volumes of raw NGL supplied by NOVATEK as a result of decrease in its gas condensate production. 10

In the first half of 2017, our expenses related to purchases of APG increased by 12.1 year-on-year to RR 12,637 million from RR 11,274 million, staying relatively flat at 29.2 of total feedstock and materials expenses. The increase in expenses was attributable to the growth in the effective average purchase price by RR 125 per bcm (11.8) largely on higher international benchmarks for liquids reflected in the respective export netbacks dynamics, only partially compensated by Russian rouble appreciation. Our APG purchasing volumes were relatively flat year-on-year. Transportation and Logistics In the first half of 2017, our transportation and logistics expenses decreased by 13.7 year-on-year to RR 32,326 million from RR 37,457 million in the first half of 2016, decreasing as a percentage of total revenue to 15.3 from 19.1 a year earlier. The decrease in expenses was largely attributable to (i) lower transported volumes of raw NGL due to higher fractionation volumes in Tobolsk, partially replaced by higher transported volumes of LPG and naphtha, (ii) Russian Rouble appreciation, which had a positive impact on the expenses related to export deliveries, (iii) lower transshipment expenses on lower NGLs export sales and changes in export routes. These factors were partially offset by a 6.0 increase on average in railroad transportation tariffs by the FAS in January 2017 (see Transportation Tariffs in Certain Factors Affecting Our Results of Operations ). Staff Costs In the first half of 2017, our staff costs increased by 8.5 year-on-year to RR 19,484 million from RR 17,953 million, remaining flat as a percentage of total revenue at 9.2. The increase in absolute terms was primarily attributable to (i) growth in the headcount of NIPIGAZ as a result of the expansion in their operations, (ii) increase in average salaries, and (iii) changes in bonus provisions, partially compensated by decrease in the headcount on changes in perimeter. Our average headcount totaled 27,680 employees in the first half of 2017. Energy and Utilities In the first half of 2017, our energy and utilities expenses increased by 4.7 year-on-year to RR 19,157 million from RR 18,304 million, decreasing as a percentage of total revenue to 9.0 from 9.3. The increase was primarily attributable to (i) the growth in our production volumes, (ii) higher energy and utilities tariffs, as well as (iii) Tobolsk HPP consolidation from February 2016 and higher fuel and electricity consumption volumes by the HPP year-on-year, which was fully offset by lower external purchases of heat and higher revenue from power and electricity sales to third parties. Our effective average electricity tariffs were up by 3.0, our effective average heat tariffs were up by 11.2 as we consolidated Tobolsk HPP, which supplied heat at relatively low tariffs compared to other suppliers. The following table presents data on our energy and utilities costs for the six months ended 30 June 2017 and 2016: RR millions, except as stated 2017 of total energy and utilities 2016 of total energy and utilities, Electricity 10,844 56.6 10,404 56.8 4.2 Fuel 4,404 23.0 3,795 20.7 16.0 Heat 2,796 14.6 2,937 16.0 (4.8) Other 1,113 5.8 1,168 6.5 (4.7) Energy and utilities, total 19,157 100.0 18,304 100.0 4.7 Depreciation and Amortisation In the first half of 2017, our depreciation and amortisation expenses increased by 2.4 to RR 17,530 million from RR 17,123 million, decreasing as a percentage of total revenue to 8.3 from 8.7. The growth in expenses was largely attributable to the upgrade of our polyolefins capacities in Tomsk in September 2016. 11

Goods for Resale In the first half of 2017, our expenses related to purchases of goods for resale increased by 68.4 yearon-year to RR 10,265 million from RR 6,095, increasing as a percentage of total revenue to 4.8 from 3.1. The increase was driven by (i) higher processing volumes of raw NGL for NOVATEK with the subsequent increase in LPG purchases for resale from this counterparty, (ii) higher volumes of MTBE purchases for resale primarily due to Uralorgsintez divestment, as SIBUR continues the distribution of MTBE produced at this site following the transaction, and (iii) higher volumes of equipment purchased by NIPIGAZ for further resale. These factors were partially offset by lower volumes of naphtha purchases due to the termination of a temporary trading arrangement, as well as lower PP purchases from NPP Neftekhimia, which was on the lengthy maintenance shutdown in the first half of 2017. Operating Profit In the first half of 2017, our operating profit increased by 20.7 year-on-year to RR 57,839 million from RR 47,916 million. The corresponding operating margin totaled 27.3 and 24.4 in the first half of 2017 and 2016, respectively. Net Finance Income In the first half of 2017, we reported a net finance income of RR 3,124 million compared to RR 25,209 million in the first half of 2016, which was largely attributable to the substantial foreign exchange gain recorded in 2016. The following table presents data on our finance income and expenses for the six months ended 30 June 2017 and 2016: RR millions, except as stated 2017 2016 Interest income 1,133 471 n/m Interest expense (4,167) (7,959) (47.6) Foreign exchange gain 5,840 33,279 (82.5) Other finance income/(expense) 318 (582) n/m Total finance income 3,124 25,209 (87.6) In the first half of 2017, we recorded a non-cash foreign exchange gain in the amount of RR 5,840 million compared to RR 33,279 million reported in the first half of 2016. The substantial gain from financing activities in the first half of 2016 was attributable primarily to the revaluation of US dollar-denominated debt, as RR/USD rate decreased by 11.8 to 64.2575 as 30 June 2016 from 72.8827 as of 31 December 2015, while RR/USD rate decreased by only 2.6 to 59.0855 as of 30 June 2017 from 60.6569 as of 31 December 2016. In the first half of 2017, our interest expense decreased by 47.6 to RR 4,167 million from RR 7,959 million in the first half of 2016 largely due to the overall decrease in total debt, inter alia the decrease in Russian rouble denominated debt bearing high interest rates, as well as the appreciation of Russian rouble, which resulted in lower accrued interest in relation to the foreign currency denominated debt. Gain on Disposal of Subsidiary In the first half of 2017, we recognised a gain of RR 19,805 million on disposal of subsidiary following the sale of Uralorgsintez to EKTOS in April 2017. Gain on Acquisition of Subsidiary In the first half of 2016, we recorded a non-cash gain on acquisition of subsidiary in the amount of RR 2,356 million following the acquisition of Tobolsk HPP from OAO Fortum in February 2016. 12

Share of net income of joint ventures and associates In the first half of 2017, we recorded a net income of joint ventures and associates in the amount of RR 529 million compared to RR 3,666 million reported in the first half of 2016. The decrease was largely attributable to the lower income of RusVinyl mainly due to foreign exchange dynamics related to RusVinyl debt, as well as to the lower income of NPP Neftekhimia resulted from a maintenance shutdown at the production site of the JV in the first half of 2017. Income Tax Expense In the first half of 2017, our income tax expense remained almost flat at RR 15,471 million compared to RR 15,874 million in the first half of 2016 as pre-tax profit remained largely unchanged year-on-year. Profit for the Reporting Period and Profit Attributable to Shareholders of SIBUR In the first half of 2017, our profit increased by 4.0 year-on-year to RR 65,826 million from RR 63,273 million in the first half of 2016 on factors described above. Our net margin totaled 31.1 and 32.3 in the first half of 2017 and 2016, respectively. In the first half of 2017, profit attributable to shareholders of SIBUR increased to RR 64,826 million from RR 63,052 million in the first half of 2016. 13

SEGMENT INFORMATION The following table presents selected financial information by segment for the six months ended 30 June 2017 and 2016: RR millions, except as stated 2017 2016 Feedstock & Energy Segment The following table presents selected financial information for the Feedstock & Energy segment for the six months ended 30 June 2017 and 2016: RR millions, except as stated 2017 of external revenue 2016 of external revenue External Revenue Feedstock & Energy 79,276 77,505 2.3 Olefins & Polyolefins 42,634 42,490 0.3 Plastics, Elastomers & Intermediates 76,192 66,614 14.4 Unallocated 13,842 9,515 45.5 TOTAL 211,944 196,124 8.1 EBITDA Feedstock & Energy 35,156 24,427 43.9 Olefins & Polyolefins 24,030 25,510 (5.8) Plastics, Elastomers & Intermediates 18,118 18,013 0.6 Unallocated (2,147) (2,570) 16.5 TOTAL 75,157 65,380 15.0 EBITDA margin Feedstock & Energy 35.2 27.4 Olefins & Polyolefins 43.1 48.4 Plastics, Elastomers & Intermediates 23.5 26.7 Unallocated n/m n/m TOTAL 35.5 33.3 Adjusted EBITDA (1) Feedstock & Energy 35,578 24,793 43.5 Olefins & Polyolefins 27,370 30,172 (9.3) Plastics, Elastomers & Intermediates 18,118 18,013 0.6 Unallocated (2,147) (2,570) 16.5 TOTAL 78,919 70,408 12.1 Total Segment Revenue 99,940 89,277 11.9 External Revenue 79,276 77,505 2.3 LPG 44,759 56.5 37,271 48.1 20.1 Natural gas 22,479 28.4 22,373 28.9 0.5 Naphtha 11,045 13.9 14,206 18.3 (22.3) Raw NGL 2 0.0 2,564 3.3 (99.9) Other sales 991 1.3 1,091 1.4 (9.2) EBITDA 35,156 24,427 43.9 EBITDA margin 35.2 27.4 Adj. EBITDA 35,578 24,793 43.5 (1) EBITDA adjusted for the respective portion of EBITDA of joint ventures and associates. 14

External Revenue In the first half of 2017, our Feedstock & Energy external revenue increased by 2.3 to RR 79,276 million from RR 77,505 million in the corresponding period of 2016 due to higher selling prices for NGLs following the positive dynamics of international market prices, largely compensated by lower sales volumes of naphtha and raw NGL, as well as Russian rouble appreciation. Liquefied Petroleum Gases (LPG) In the first half of 2017, our revenue from LPG sales increased by 20.1 year-on-year to RR 44,759 million from RR 37,271 million on an 18.8 increase in the effective average selling price and a 1.1 increase in sales volumes. The increase in our effective average selling price was driven by positive dynamics in international market prices partially offset by the Russian rouble appreciation. Our LPG sales volumes marginally increased year-on-year, while there were material movements in the flows as a result of shutdowns at our production site in Tobolsk in the first half of 2016. Overall the shutdowns were shorter in the first half of 2017 compared to a year earlier. Also during one of the shutdowns in 2016 our fractionation capacity was expanded from 6.6 to 8.0 mtpa of raw NGL. This resulted in the following year-on-year changes: (i) 6.4 increase in our LPG production volumes; (ii) higher processing volumes of raw NGL for NOVATEK with the subsequent increase in LPG purchases for resale from this counterparty; (iii) increase in LPG deliveries to our cracker in Kstovo, as previously supplied raw NGL was utilised at the expanded fractionation capacity; (iv) higher LPG consumption at the polypropylene production in Tobolsk. Overall higher available volumes of LPG were primarily channeled to our Olefins & Polyolefins business. In the first half of 2017, our domestic sales accounted for 26.6 of total LPG revenue, while 73.4 was attributable to export sales. Natural Gas In the first half of 2017, our revenue from natural gas sales remained relatively unchanged at RR 22,479 million on a flat effective average selling price due to flat regulated natural gas prices, as well as flat production volumes due to stable volumes of processed APG. We sell 100 of our natural gas in Russia. Naphtha In the first half of 2017, our revenue from naphtha sales decreased by 22.3 year-on-year to RR 11,045 million from RR 14,206 million on a 31.5 decrease in the sales volumes despite a 13.5 increase in the effective average selling price. The decrease in sales volumes was largely attributable to (i) increase in naphtha deliveries to our crackers (primarily in Tomsk), as previously supplied raw NGL was utilised at the expanded fractionation capacity, and (ii) termination of a temporary trading arrangement at the end of 2016. Our naphtha production increased by 5.9 year-on-year on higher raw NGL fractionation volumes. We also increased third-party purchases of naphtha for further processing. The increase in our effective average selling price was driven by the positive dynamics of international market prices and favorable changes in our contract terms with customers, partially compensated by Russian rouble appreciation. In the first half of 2017, our domestic sales accounted for 47.0 of total naphtha revenue, while 53.0 was attributable to export sales. 15

Raw NGL In the first half of 2017, our external sales of raw NGL were almost null. Raw NGL production at our GPPs increased by 2.1, while third-party purchases decreased year-on-year. All available raw NGL volumes were fractionated in the first half of 2017, as our Tobolsk production site was on a long maintenance shutdown a year earlier, when the capacity was expanded from 6.6 to 8.0 mtpa of raw NGL. As a result, our fractionation volumes increased by 7.7 year-on-year. EBITDA In the first half of 2017, our Feedstock & Energy EBITDA increased by 43.9 year-on-year to RR 35,156 million from RR 24,427 million. While the segment revenue from external sales increased only marginally, the revenue from intercompany sales to the petrochemicals businesses increased by 75 year-on-year due to higher netback prices for LPG and naphtha and replacement of cheaper raw NGL with more expensive LPG and naphtha at our crackers. As a result, our total revenue from Feedstock & Energy sales increased by 11.9 year-on-year. The segment was also the major beneficiary of the decrease in the Group transportation and logistics expenses. Following the expansion of fractionation capacity in Tobolsk, we terminated external raw NGL sales, and lower volumes of raw NGL were transported between our production sites, which was replaced by higher transported volumes of LPG and naphtha. The appreciation of the Russian rouble had a positive impact on the expenses related to export deliveries of LPG and naphtha. In the first half of 2017, the segment EBITDA margin totaled 35.2, a year-on-year increase from 27.4. Higher margin was attributable to higher netbacks and lower transportation expenses as mentioned above. Olefins & Polyolefins Segment The following table presents selected financial information for the Olefins & Polyolefins segment for the six months ended 30 June 2017 and 2016: RR millions, except as stated 2017 of external revenue 2016 of external revenue Total Segment Revenue 55,752 52,725 5.7 External Revenue 42,634 42,490 0.3 PP 19,467 45.7 18,965 44.6 2.6 PE 10,985 25.8 10,118 23.8 8.6 BOPP-films 8,418 19.7 9,353 22.0 (10.0) Olefins 2,770 6.5 2,565 6.0 8.0 Other polymers products 661 1.6 1,118 2.6 (40.9) Other sales 333 0.8 371 0.9 (10.2) EBITDA 24,030 25,510 (5.8) EBITDA margin 43.1 48.4 Adj. EBITDA 27,370 30,172 (9.3) External Revenue In the first half of 2017, our Olefins & Polyolefins segment external revenue remained largely flat at RR 42,634 million as compared to the corresponding period of 2016. The increase in polyolefins revenue attributable to a year-on-year increase in the average capacity utilisation rate at our PE and PP production was offset by decrease in revenue from BOPP-films, which was mainly a result of lower effective average selling prices. Polypropylene (PP) In the first half of 2017, our revenue from sales of PP increased by 2.6 to RR 19,476 million from RR 18,965 million in the corresponding period of 2016 on a 7.7 increase in sales volumes despite a 4.7 decrease in the effective average selling price. 16

Our PP sales volumes growth was primarily attributable to (i) an 11.3 increase in production due to an increase in capacity utilisation rate at our polypropylene production site in Tobolsk compared to year earlier as a result of lengthy maintenance shutdowns in the first half of 2016, (ii) lower volumes used internally following the divestment of geosynthetics business that consumed PP as feedstock, and (iii) lower inventory accumulation as compared to the corresponding period of 2016 when we increased stock pending lengthy maintenance shutdown discussed above. This was partially offset by lower third-party purchases from NPP Neftekhimia resulted from a maintenance shutdown at the production site of the JV in the first half of 2017. Our effective selling prices for PP decreased as higher international market prices were fully offset by Russian Rouble appreciation. In the first half of 2017, domestic sales accounted for 61.3 of total PP revenue, while 38.7 was attributable to export sales. Low Density Polyethylene (LDPE) In the first half of 2017, our revenue from sales of LDPE increased by 8.6 to RR 10,985 million from RR 10,118 million in the corresponding period of 2016 on a 16.7 increase in sales volumes despite a 6.9 decrease in the effective average selling price. The increase in LDPE sales volumes was attributable to a 9.4 growth in production volumes following the completion of capacity expansion investment project at our production site in Tomsk (increase in the annual nameplate production capacity to 270,000 tonnes from 245,000 tonnes). This was supported by lower inventory accumulation as compared to the corresponding period of 2016, when we accumulated inventories pending maintenance shutdown at our production site in Tomsk as part of polyolefins capacity expansion investment project. The decrease in the effective average selling price for LDPE despite higher international market prices was mainly attributable to the Russian rouble appreciation. In the first half of 2017, domestic sales accounted for 71.3 of total LDPE revenue, while 28.7 was attributable to export sales. BOPP-films In the first half of 2017, our revenue from BOPP-film sales decreased by 10.0 to RR 8,418 million from RR 9,353 million in the corresponding period of 2016 on a 12.6 decrease in the effective average selling price despite a 3.0 increase in sales volumes. The decrease in the effective average selling price despite positive dynamics of international market prices was largely attributable to Russian rouble appreciation, lower spreads between BOPP and PP that drive export prices, and higher share of contract sales on highly competitive export markets. Higher sales volumes despite lower production were largely attributable to inventory sales as compared to marginal inventory accumulation year earlier, which was a result of postponed launch of third-party production on the domestic market. In the first half of 2017, domestic sales accounted for 66.8 of total BOPP-film revenue, while 33.2 was attributable to export sales. Olefins (Ethylene) In the first half of 2017, our external revenue from olefins sales represented by ethylene increased by 8.0 to RR 2,770 million from RR 2,565 million in the corresponding period of 2016. The increase was largely attributable to higher effective average selling price on flat sales volumes. Increase in the effective average selling price reflected higher LPG and naphtha prices that drive our selling price. We sell 100 of our ethylene in Russia. 17

EBITDA In the first half of 2017, our Olefins & Polyolefins EBITDA decreased by 5.8 year-on-year to RR 24,030 million from RR 25,510 million primarily due to (i) tighter spreads, as the increase in international benchmark prices for polyolefins was moderate compared to the increase in the netbacks for liquids that are consumed by the segment as feedstock, and (ii) Russian rouble appreciation that fully offset the positive dynamics in international market prices. Higher sales volumes of PP and PE resulted from increased average capacity utilisation rate at our production sites were a supportive factor. In the first half of 2017, the segment EBITDA margin totaled 43.1, a year-on-year decrease from 48.4. Lower margin was attributable to tighter spreads as mentioned above. Plastics, Elastomers & Intermediates Segment The following table presents selected financial information for the Plastics, Elastomers & Intermediates segment for the six months ended 30 June 2017 and 2016: RR millions, except as stated 2017 of external revenue 2016 of external revenue Total Segment Revenue 77,214 67,540 14.3 External Revenue 76,192 66,614 14.4 Plastics and organic synthesis products 23,976 31.5 23,948 36.0 0.1 Elastomers 27,488 36.1 19,694 29.6 39.6 MTBE and fuel additives 12,128 15.9 11,599 17.4 4.6 Intermediates and other chemicals 11,981 15.7 10,571 15.9 13.3 Other sales 619 0.8 802 1.2 (22.8) EBITDA 18,118 18,013 0.6 EBITDA margin 23.5 26.7 Adj. EBITDA 18,118 18,013 0.6 External Revenue In the first half of 2017, our Plastics, Elastomers & Intermediates segment external revenue increased by 14.4 year-on-year to RR 76,192 million from RR 66,614 million. The increase was largely driven by higher revenue from elastomers sales, with commodity rubbers being a key growth driver, as well as higher revenue from intermediates, while revenue from plastics and organic synthesis products and MTBE and fuel additives was relatively flat. Plastics and organic synthesis products In the first half of 2017, our revenue from sales of plastics and organic synthesis products was almost flat year-on-year at RR 23,976 million compared to RR 23,948 million as a 1.2 increase in sales volumes was fully offset by a 1.0 decrease in the effective average selling price. The increase in sales volumes was largely attributable to (i) higher sales volumes of PET as we accumulated inventories pending maintenance shutdowns at our PET production sites a year earlier and decreased inventory levels this year, (ii) higher sales of alcohols on higher sales of inventories in the first half of 2017, as well as lower internal use following the changes in acrylates production mix, partially compensated by (iii) lower sales of EPS largely due to moderate inventory accumulation in the first half of 2017 compared to inventory sales in previous year. The decrease in the effective average selling was a result of Russian rouble appreciation that fully negated growth in international market prices for the vast majority of products. In the first half of 2017, domestic sales accounted for 74.5 of total plastics and organic synthesis products revenue, while 25.5 was attributable to export sales. 18

Elastomers In the first half of 2017, our revenue from elastomers sales increased by 39.6 year-on-year to RR 27,488 million from RR 19,694 million in the first half of 2016 on a 33.8 increase in our effective average selling price and a 4.3 increase in sales volumes. The increase in our effective average selling price was mainly driven by favorable market environment reflected by increase in international benchmarks and partly offset by the Russian rouble appreciation. The increase in sales volumes on higher production mainly driven by improved demand was partially compensated by changes in stock: in the first half of 2017 we accumulated inventories, inter alia related to goods-in-transit balances to export markets and scheduled maintenance shutdowns, while in the first half of 2016 we saw substantial inventory sales. In the first half of 2017, domestic sales accounted for 33.7 of total elastomers revenue, while 66.3 was attributable to export sales. MTBE and fuel additives In the first half of 2017, our revenue from MTBE and fuel additives sales increased by 4.6 year-on-year to RR 12,128 million from RR 11,599 million on a 12.8 increase in volumes despite a 7.3 decrease in the effective average selling price. The increase in sales volumes was largely attributable to higher sales of MTBE under trading agreements, partially compensated by lower production volumes following the divestment of Uralorgsintez in April 2017, as well as (ii) higher production and sales volumes of other fuels and fuel additives. The decrease in effective average selling price for MTBE despite higher international market prices was mainly driven by significant decrease in domestic demand for high-octane fuel additives, which resulted in higher export sales at the expense of domestic sales that are more premium, as well as Russian rouble appreciation. In the first half of 2017, our share of domestic sales decreased to 36.5 of total MTBE and fuel additives revenue from 68.3 in the respective period of 2016, while 63.5 and 31.7, respectively, were derived from export sales. The change in the sales mix was primarily attributable to lower domestic demand as mentioned above. Intermediates and other chemicals In the first half of 2017, our revenue from sales of intermediates and other chemicals increased by 13.3 year-on-year to RR 11,981 million from RR 10,571 million. The increase was largely attributable to higher revenue from propylene sales on production growth mainly due to shorter maintenance shutdowns at our production site in Tobolsk compared to the previous year, as well as higher international market prices, partially compensated by Russian rouble appreciation. In the first half of 2017, domestic sales accounted for 69.9 of total intermediates and other chemicals revenue, while 30.1 was attributable to export sales. EBITDA In the first half of 2017, our Plastics, Elastomers & Intermediates EBITDA remained almost flat at RR 18,118 million, as higher sales volumes were offset by tighter petrochemicals spreads. The segment EBITDA margin totaled 23.5, a year-on-year decrease from 26.7, which was attributable to higher trading volumes, primarily MTBE, as well as certain intermediates produced by the Olefins & Polyolefins segment. 19