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Sibneft Begins Major Gas Supply Contract with Omsk Caoutchouc

Moscow, July 28, 2005. Sibneft today began deliveries of industrial volumes of natural gas to provide energy for rubber manufacturer Omsk Caoutchouc. Under a five-year supply contract, Sibneft will deliver 340 million cubic meters of natural gas to Omsk Caoutchouc annually.

Omsk Caoutchouc is one of Russia’s largest manufacturers of synthetic caoutchouc, a type of latex rubber, and is also a major gas consumer. In close cooperation with Sibneft, the enterprise specially built an on-site gas-fueled heat and power plant to provide electricity and steam for its operations.

Sibneft will supply gas from fields at its main production subsidiary, Sibneft-Noyabrskneftegas. Prior to delivery, the gas will be processed at the facilities of petrochemicals firm AK Sibur. Sibneft’s Omsk Refinery will serve as a backup gas source for Omsk Caoutchouc’s new power station.

“This supply deal represents an important step forward for a promising part of our business – the processing and sale of associated gas,” said Sibneft president Eugene Shvidler. “It is also a logical extension of the company’s deep involvement in the Omsk region’s economy.”