No. 3, 2004


Events, Agreements, Meetings

April 5, 2004: In Hurghada (Egypt), an international seminar of representatives of investment funds and the business press was held to discuss LUKOIL's activities in the Middle East and North Africa.

April 14, 2004: In Rostov-on-Don (the Rostov Region), President of JSC LUKOIL Vagit Alekperov met with the heads of the regional administrations of the RF Southern Federal District and informed them in detail about LUKOIL's activities in the region.

April 16, 2004: In Moscow, Islam Karimov, President of the Republic of Uzbekistan, met with LUKOIL President Vagit Alekperov to review the current state of the promising Kandym-Khauzak-Shady gas project and the geological prospecting project in the Ustyurt. At the meeting both parties reached agreement on stepping up the preparation of basic project documentation.

April 16, 2004: In Moscow the Scientific Council of the Russian Academy of Civil Service under the RF President awarded LUKOIL President Vagit Alekperov an honorary doctorate for his contribution to the development of the fuel and energy complex of Russia.

April 20, 2004: The calculation and independent audit of LUKOIL's oil and gas reserves were completed. According to Miller and Lents (USA), the Company's proved hydrocarbon reserves as of January 1, 2004 amounted to 20,056 bln. barrels of oil equivalent.

April 21, 2004: In London, a ceremony was held to award the annual prizes of the American Global Finance journal. LUKOIL was named the winner in the Best Oil and Gas Company nomination, and the General Director of LUKOIL Financial Services Ltd., Sergey Popov, received the Global Finance crystal prize on behalf of the Company.

April 22, 2004: In St. Petersburg, LUKOIL President Vagit Alekperov and Valentina Matviyenko, Governor of St. Petersburg, signed an agreement on cooperation between the Company and the City Government. The document set out the main spheres of cooperation in the socio-economic development of St. Petersburg and its fuel and energy complex for 2004-2007.

April 28, 2004: In Moscow, in the Head office of LUKOIL, was held an Open Day for students of the Gubkin Russian Oil and Gas University, the Moscow Institute of Physics and Technology, the Institute of Energy Diplomacy of the Moscow State Institute of Foreign Relations, as well as senior grades from secondary school No. 45.

April 29, 2004: At Sheremetyevo II Airport (Moscow), for the first time in the practice of Russian oil companies and airfield services of Russia's civil aviation, a Lufthansa aircraft was fuelled with Jet A-1 jet fuel produced by LUKOIL refineries.

April 12, 2004: In Moscow, Vagit Alekperov, President of LUKOIL and Fred Higgs, General Secretary of the International Federation of Chemical, Energy, Mine and General Workers Union (ICEM), and Lev Mironov, Chairman of the Russian Oil, Gas and Construction Workers Union, signed a cooperation agreement.

May 18-19, 2004: In Moscow, the 3rd International Forum Oil of Russia: Present and Future was held. Dr. Valery Graifer, the Chairman of LUKOIL Board of Directors, Dr. Vagit Sharifov, LUKOIL Vice-President and some eminent representatives of the academic and engineering community took part in its work.

May 24, 2004: In Bucharest (Romania), the LUKOIL Board of Directors held a guest session, where it gave its preliminary approval of the Company's financial statement for 2003. The meeting also heard spokesmen of the Board's committees for strategy and investment, human resources and compensation, and audit.

May 26, 2004: During his working visit to Moscow, the Prime Minister of the Republic of Kazakhstan, Danial Akhmetov, had a meeting with LUKOIL President Vagit Alekperov to discuss issues associated with the implementation of joint oil projects on the Caspian sea.

June 2, 2004: In Baku (Azerbaijan), at the Caspian Oil and Gas International Exhibition and Conference, presented the results of geological exploration work carried out by LUKOIL in the northern part of the Caspian Sea.

June 4, 2004: In Astana (Kazakhstan), LUKOIL President Vagit Alekperov took part in the 11th plenary session of the Council of Foreign Investors, chaired by President of the Republic of Kazakhstan Nursultan Nazarbayev.

June 7, 2004: LUKOIL announced the start of its Fill up in Olympic Style competition which will continue until August 1, 2004 at 90 of the Company's gasoline filling stations in Moscow and a number of other cities in Central Russia.

June 15, 2004: LUKOIL Overseas Holding Ltd. began seismics under the Tyub-Karagan and Atashsky projects in the Caspian Sea, which are being implemented by the Company on a parity basis with KazMunayGaz the national oil and gas company of the Republic of Kazakhstan.

June 16, 2004: In Vysotsk (the Leningrad Region), within the framework of the 8th St. Petersburg Economic Forum, a ceremony was held to launch Phase-I of the LUKOIL-II transshipment complex constructed by LUKOIL for exporting crude oil and petroleum products. Russian Prime Minister Mikhail Fradkov and other high level officials took part in the ceremony.

June 16, 2004: In Tashkent (the Republic of Uzbekistan), LUKOIL President Vagit Alekperov, Deputy Prime Minister of the Republic Utkir Sultanov and Chairman of the Uzbekneftegaz National Holding Company Abdusalom Azizov signed a Product Sharing Agreement for the Kandym-Khauzak-Shady project, envisaging natural gas production in the Bukhara-Khiva area in the south-west of the country. The consortium of investors includes LUKOIL (90%) and the Uzbekneftegaz National Holding Company (10%).

June 21, 2004: In Penza (the Penza Region) the Governor Vasily Bochkaryov and LUKOIL Vice-President Serik Rakhmetov signed a protocol of intent to conclude agreements between the industrial companies of the Penza Region and LUKOIL on supplies to the Company of production equipment and tools produced by the Region's industry.

June 22, 2004: In Moscow, the first meeting of the joint technical committee of LUKOIL and the Iraq Oil Ministry was held to discuss cooperation in Iraq's oil and gas industry. The meeting participants were Azat Shamsuarov, Operations Senior Vice-President of LUKOIL Overseas Holding Ltd., Consultant of the Iraq Oil Ministry Abdulilyahi Kasim al-Amir, General Director of the Northern Petroleum Company of Iraq Adil Mustafa al-Qazaz, Regional Director of LUKOIL Overseas Holding Ltd. for the Middle East Alexander Kolomatsky, as well as specialists in oil production and refining and personnel training from both sides. They considered a number of issues associated with cooperation in Iraq's oil and gas industry.

June 24, 2004: The Annual General Meeting of LUKOIL shareholders was held in Moscow. The meeting approved the report on the Company's operations in 2003, as well as the financial statements for the financial year. The shareholders elected the LUKOIL Board of Directors, with Valery Graifer being re-elected as the Chairman of the Board.

June 28, 2004: In Kstovo (the Nizhniy Novgorod Region), a ceremony was held at JSC LUKOIL-Nizhegorodnefteorgsintez to commission an LF-35/21-1000 catalytic reforming unit with continuous catalyzer regeneration. Russia's only LF-35/21-1000 catalytic reforming unit has a capacity of 1 mln. tons of crude a year and belongs to the fourth generation of such units.

June 29, 2004: The LUKOIL Board of Directors passed a decision to sell a block of shares in Bank Petrocommerce (Russia), constituting over 80% of its equity capital, to the Financial Group Capital. The transaction value is over $200 mln.

June 30, 2004: LUKOIL signed a binding agreement to purchase from ENI (Italy) its 50% interest in LUKAgip N.V. The transaction is expected to be finally completed on fulfillment of certain terms and conditions in the third quarter of 2004.

June 30, 2004: In Odessa (Ukraine), at the LUKOIL-Odessa Refinery, a ceremony was held to launch an isomerization unit with a capacity of 120,000 tons a year. LUKOIL President Vagit Alekperov and Ukraine Prime Minister Viktor Yanukovich took part in the ceremony.

July 1, 2004: In Ukhta (the Republic of Komi), a new trestle for oil discharge and dark petroleum products loading was put into operation at JSC LUKOIL-Ukhtaneftepererabotka. The design solutions used virtually eliminate loses of hydrocarbons during trade operations and, correspondingly, minimize the impact on the environment.

July 2, 2004: LUKOIL Scientific and Technical Council, chaired by the Company's President Vagit Alekperov, approved inclusion in the corporate investment program of a project to create a system for collecting, processing, transporting and utilizing associated petroleum gas produced by LUKOIL-Perm in the north of the Perm Region. The new system will link together the three biggest production facilities in the Krasnovishersk and Solikamsk districts the Ozernoye, Magovskoye and Logovskoye fields, where crude oil with a high gas factor is produced.

July 5, 2004: LUKOIL Overseas Holding Ltd. started sales of crude oil from Karachaganak field via the Caspian Pipeline Consortium system (CPC). The first tanker loaded with the LUKOIL production share from northwest Kazakhstan Karachaganak field departed from South Ozereyka terminal near Novorossiysk.

July 19, 2004: In Moscow, a meeting of the LUKOIL Board of Directors was held. The meeting approved composition of the LUKOIL Managing Board of 15 members heading by President Vagit Alekperov, the Board of Directors plan of activities for 2004-2005, as well as the document The Mission of JSC LUKOIL.

July 20, 2004: In Kaliningrad (the Kaliningrad Region), LUKOIL-Kalinin-gradmorneft held a ceremony to start oil production at the Kravtsovskoye (D-6) field in the Baltic offshore. Dr. Sergey Yastrzhembsky, Special Representative of RF President, Vladimir Egorov, Governor of the Kaliningrad Region, and Vagit Alekperov, LUKOIL President, participated in the ceremony.

July 21, 2004: In Moscow, the meeting took place of the LUKOIL Coordination Council for Work with Higher Education Institutions, chaired by Anatoly Moskalenko, Head of the Main HR Department of LUKOIL, with representatives of the leading Russian universities. Some issues of further cooperation with them were discussed at the meeting.

July 22, 2004: In Moscow, RF Prime Minister Mikhail Fradkov signed an order to sell state-owned stake of LUKOIL (7.59% of Company's stock) at auction as one lot.

July 22, 2004: In Krasnodar (the Krasnodar Territory), RF President Vladimir Putin met James Mulva, President of ConocoPhillips, to discuss the cooperation of the company with Russian oil and gas majors. LUKOIL President Vagit Alekperov also participated in the meeting.

July 27, 2004: The first group of Iraqi specialists arrived in Kogalym (the Khanty-Mansi Autonomous Area) for training at JSC LUKOIL-West Siberia in accordance with the Memorandum of Understanding and Cooperation signed in March 2003 by Vagit Alekperov, LUKOIL President, and Ibrahim Bahr al-Ulyum, Minister of Oil of Iraq.

July 27, 2004: In Moscow, Aleksey Smirnov, General Director of LUKOIL-Neftekhim, and Oleg Frayev, General Director of the Moscow Industrial and Trade Center for Integration and Development signed an agreement to purchase from the MITCID 87.42% of the shares of JSC Stavropolpolimerprodukt.

July 29, 2004: LUKOIL published reviewed preliminary results of the Company's performance for the first half of 2004. Crude oil output of LUKOIL Group totaled 42.15 mln. tons, which is 8.4% higher than in same period of 2003. LUKOIL refineries produced 19.7 mln. tons of oil products in the first half of 2004, which is 3.1% more than in the same period of 2003.

July 30, 2004: In Stavropol (the Stavropol Territory) representatives of government of the Territory and LUKOIL-Neftekhim signed an agreement to construct in Budyonnovsk a polypropylene production plant with capacity of about 100 thousand tons per year.

August 11, 2004: A ceremony of awarding winners of the Fill up in Olympic Style competition organized by LUKOIL was held in Moscow. The main prizes of the competition, certificates of five tourist trips to the Olympic Games in Athens (Greece), were given to the winners.

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Oil of Russia, No. 3, 2004
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