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Sibneft Revenues Up 40.2% in Preliminary 2002 Financial Results

Moscow, February 3, 2003. Sibneft revenues from oil and gas sales rose by 40.2% to $4.835 billion in 2002 from $3.449 billion the previous year, according to preliminary financial results calculated to U.S. GAAP accounting standards. Earnings before interest, tax, depreciation and amortization (EBITDA) were 3.3% higher, totaling $1.775 billion compared to $1.719 billion in 2001.

Expected net income for 2002 was $1.050 billion, down from $1.305 billion in 2001. The decrease was primarily due to lower domestic prices for oil products, purchases of third-party crude oil for the Moscow Refinery, and a higher unified natural resource tax, as well as increased interest expenses and a higher effective income tax rate.

Capital expenditures rose from $618.7 million in 2001 to $880 million in 2002 as Sibneft boosted oil production by an industry-leading 27.4% and expanded its retail network into profitable new regions. The company expects to spend at least $925 million in capital expenditures for 2003, not including spending related to Slavneft.

Sibneft continued to boast Russia’s highest EBITDA per ton of oil production in 2002, estimated at $67.4 per ton, and maintained the industry’s lowest lifting costs of about $1.70 per barrel. Total debt as of year-end stood at $2.175 billion compared to $923 million at the beginning of 2002.

“2002 was another year of progress for Sibneft, as we boosted production and sales at an impressive rate,” said Sibneft president Eugene Shvidler. “We also invested heavily in the future of the company through capital expenditures and acquisitions, which we are confident will result in even more impressive growth and increased profitability over the next few years.”