Sibneft Reports First Half Results, Targets Large Increase In Full Year Earnings

Moscow, 22 October 2001; Sibneft achieved net income of $613 million in the first six months of the year, under unaudited US GAAP financial results released today. Total revenues reached $1.663 billion, while earnings before interest, tax, depreciation and amortization (EBITDA) totaled $871 million.

Sibneft expects to achieve substantial growth in full-year earnings, with net income before dividends forecast to top $1.1 billion, against $675 million in 2000. Sibneft anticipates EBITDA of around $1.6 billion, while net revenues are expected to total approximately $3.3 billion.

The strong growth in earnings is being driven by a combination of benefits flowing from the company's successful consolidation and by higher than anticipated output. The forecasts assume an average Brent price for the year of $24 per barrel.

The financial results of Orenburgneft, in which Sibneft holds a 40% stake, will not be consolidated into Sibneft's 2001 financial statements as the company is not technically ready to prepare accounts under US GAAP standards.

Sibneft is Russia's fastest growing oil company, with output in September running at 434,000 barrels per day (1.804 million tonnes), a 22% increase on the same month last year. Production in the first three quarters of 2001 grew by 18.7% over the same period last year.

"The earnings outlook for this year is excellent, and we expect accelerating growth in output to continue to drive earnings in the years to come," Sibneft president Eugene Shvidler said.