Reference: Total amount of investment in the project will be around 100 million euros. Air Liquide participation in new JV: 75% minus one share. Severstal participation: 25% plus one share. Commissioning of the object is planned for the first half of 2007.

At the ceremony, JSC Severstal General Director A.N. Kruchinin underlined that "building a new oxygen block is another step in the development of Russian-French relationship in the field of business. For Severstal, this joint venture is the second one with foreign partners. The first one, Severgal, a JV with Arcelor, representing an industrial line for manufacturing   hot-dip galvanized sheets, will be commissioned this year. Decision to build a new object was taken in accordance with the program of increasing JSC Severstal production. Air Liquide was chosen as a partner because it has great experience in building and running similar objects and its name is well known all over the world".

In his turn, Klaus Schmieder, member of Air Liquide Board of Directors, said the following: "We are very pleased to have Severstal as partners, a company that is not only a leader in steelmaking, but is also well known all over the world. This partnership will enable us to reinforce our position in the world market as well as in Eastern Europe and in Russia, whose industry is developing more and more dynamically and which possesses a very promising potential for Air Liquide".

The installation, after having been designed and built at JSC Severstal industrial site, will be the biggest air separation unit in Russia and the biggest one in the world used in steelmaking. It will provide to the works high pressure high purity oxygen as well as nitrogen and argon, in accordance with a gas supply contract.

The main consumer of products generated by the new air separation unit will be BOF shop, as the oxygen, having a very high degree of purity, is necessary for making IF type steelgrades with low nitrogen content.

Besides, commissioning of the new installation will allow to reduce energy consumption of gas generating and to improve production safety by using internal compression process.

Air Liquide (France) is the world leader in production of industrial and medical gasses, equipment for air separation and related services. The Company was established in 1902. Air Liquide designed and constructed over three thousand plants, it owns and operates over 500 plants in more than 70 countries and 5500 km of oxygen, nitrogen and hydrogen pipelines in Europe and the USA. The Company employs over 36 thousand people. In 2004 the turnover of the Company was increased up to ? 9 376 Mio. Air Liquide is listed at Paris Exchange and is a member of 40 Eurostoxx 50 stock indices (code  ISIN FR 0000120073).

Severstal JSC (Russia, the Vologda region) is a central plant of the multiprofile group and steel making division. Severstal Joint Stock Company is an assignee of Cherepovets Iron-and-Steel Works, the latter being founded in 1955. The history of Cherepovets Iron-and-Steel Works began with Blast Furnace #1 blow-in. Thus, this year 2005 is jubilation one for the Company. Severtal produced over 10.4 Mio t of crude steel and over 9,2 Mio t of rolled products in 2004. JSC Severstal has about 36.5 thousand employees. Based on the results of 2004 business, Severstal was number 12 among the top global steel producers (including Severstal NA and Lucchini output).

Severstal JSC consolidated revenues in 2004 was US $ 6 bln 647 mio 929 thousand (International Accounting Standards). Severstal stocks are listed at Russian Commodities and Raw Materials Exchange and at Moscow Interbank Currency Exchange.