With independent auditor’s report

JSC “Uzbekneftegaz”
Consolidated financial statements
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
46
21. 
Shareholders’ equity (continued)
Contributions to share capital (continued)
ii)
Conversion of borrowings and dividends payable (2020)
In April 2020, the Company issued 33,079,989,640 of common shares with UZS 500 par value per share. As
consideration, the Company converted the loans provided by Fund for Reconstruction and Development of the
Republic of Uzbekistan to the Group during 2010-2019 for financing investments projects in the total amount
UZS 16,425 billion and dividends payable in the amount UZS 115 billion into shareholders’ equity. The
difference in the amount of 1,023 billion UZS between the nominal amount and book value of the converted
borrowings was recognized in retained earnings of the Group.
Reduction of share capital
In December 2020, the Group officially registered a decrease in the share capital in the total amount of
UZS 11,194 billion ( 22,378,567,524 common shares with par value UZS 500) in return of Group’s interest in
certain companies transferred to the State Asset Management Agency in 2019 and 2020:
i)
JSC “Uztransgaz” (2018, 2019 and 2020)
In November 2019, according to the Decree of President of Republic of Uzbekistan No. 4288 from 9 July 2019,
the Group transferred 39.5% of the share interest in JSC “Uztransgaz” to the State Asset Management Agency
without any consideration. Remaining 8.3% share interest in JSC “Uztransgaz” was recognized as financial
assets measured at fair value through other comprehensive income. The difference in the amount of
UZS 9,211 billion between the book value of investment in associate (UZS 11,128 billion) and fair value of the
remaining 8.3% share interest in JSC “Uztransgaz” (UZS 1,917 billion) was recognized in the equity.
In October 2020 the Group transferred the remaining 8.3% share interest in JSC “Uztransgaz” to the State
Asset Management Agency without any consideration. The fair value of these shares as at the disposal date
in the amount of UZS 1,073 billion was recognized as a reduction of retained earnings.
In December 2020, when the formal registration of the share capital reduction was completed, the Group
recognized the decrease in share capital at the amount of UZS 10,233 billion, related to the transfer of 47.8%
shares of JSC “Uztransgaz”, with an adjustment of the retained earnings in the amount of UZS 9,160 billion.
ii)
“Fergana Refinery Plant” LLC (2020)
In accordance with the Decree of President of Republic of Uzbekistan No. 4275 dated 10 April 2019, it was
decided to transfer 100% of share interest of “Fergana Refinery Plant” LLC to State Asset Management
Agency. Transfer of 100% of shares of “Fergana Refinery Plant” LLC took place in March 2020. The difference
in the amount of UZS 208 billion, between book value of the net assets of “Fergana Refinery Plant” LLC as of
the disposal date (UZS 292 billion) and nominal amount of shares by which share capital was decreased
(UZS 84 billion,
Note 6
) was recognized in retained earnings.
iii) 
Transfer of other entities (2019 and 2020)
In accordance with the Decree of the President of Republic of Uzbekistan No. 4388 from 9 July 2019, in 2019
the Group has transferred its participation share in certain service companies (drilling, construction and
installation, transport companies) to the State Asset Management Agency (
Note 6
, Disposal of service
companies ).
The difference between assets and liabilities of the disposed entities in the amount of 1,023 million UZS was
recognized in retaining earnings.
In December 2020, when the formal registration of the share capital reduction was completed, the Group
recognized the decrease in share capital at the amount of UZS 877 billion, related to the transfer of these
companies, with an adjustment of the retained earnings for the same amount.

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