Sibneft Consolidation Plan Wins Shareholder Backing

Moscow, 27 December 2000; Sibneft has won the backing of shareholders in three key operating units for a share exchange enabling the company to complete the consolidation of its subsidiaries. Meetings of shareholders in production subsidiary Noyabrskneftegas, the Omsk refinery and retail subsidiary Omsknefteproduct on 26 December approved the exchange of existing shares for new paper with a higher nominal value.

The green light from shareholders will enable Sibneft to raise its stake in the three subsidiaries to 100% by the middle of next year. Minority shareholders holding a quantity of shares insufficient to qualify for one new share will instead be bought out at prices recommended by an independent valuations expert. This will be the first time that such an exchange has been used by a major Russian oil company to consolidate stakes in its subsidiaries.