Moscow, January 27, 2005 — RUSAL, one of the world's leading aluminium producers, today announced 2004 production results for the full year 2004. Key results for the past year include a significant expansion of the raw material base, strong volume growth in added-value aluminium products and implementation of the outsourcing program for service functions.

The most significant development for RUSAL in 2004 was the progress made on the key strategic goal of expanding the company's raw material base and achieving self-sufficiency in raw materials. In 2004 alumina output was 3,140,002 tons, a 5.3% increase over 2003. This was the result of capacity expansion at RUSAL's Nikolaev Alumina Refinery and performance improvement at the company's Achinsk Alumina Refinery. Bauxite production was 4,867,271 tonnes, an 11.9% increase over 2003.

Commenting on the production results, Alexander Bulygin, RUSAL's Chief Executive Officer, said, «We are pleased with these full year production figures. The production growth at our smelters and refineries has more than matched our expectations and underlines the significant year-on-year progress RUSAL continues to make. Much of this growth has come from the commitment to investment and modernization projects the company made some time ago. I look forward to seeing the current investments and projects deliver similarly impressive results in the future. As we begin 2005, RUSAL is committed to continuing its investment in infrastructure and people, identifying greater efficiencies and securing new sources of raw materials as we look to cement our position as one of the world's leading aluminium companies.»

The most significant contribution to the expansion of RUSAL's raw material base is the pending acquisition of a 20% share in Queensland Alumina Ltd. in Australia, the largest alumina refinery in the world. This acquisition, along with the purchase of the Bauxitogorsk alumina refinery completed in December 2004, will enable the company to increase alumina output volumes by more than 25%.

Further raw material projects include the exploration and production of bauxite at three deposits belonging to the North Onega bauxite group, with overall reserves of over 800 mln tonnes. RUSAL won the license to develop these in an auction in December 2004.

Production of primary aluminium in 2004 amounted to 2,670,967 tonnes, a 3.1% year-on-year increase. The increase was as a result of production expansion, investment in new equipment, the introduction of new technologies and the improvement of performance indicators. RUSAL obtained approval from the Russian Government to sell two rolling mills to Alcoa — Samara Metal Works and Belaya-Kalitva Metallurgical Production Association, an important step in allowing RUSAL to focus on its core business producing primary aluminium and alloys.

RUSAL continues to increase the share of value-added casthouse products in the overall production total, with the aim of meeting a 50% share by 2013. In 2004 the volume of value-added casthouse product output increased by 33.5% to approx. 740,000 tonnes. The share of these products in the overall aluminium production total in 2004 was 17%, a 6.4% increase over 2003. This trend enables the company to better focus on the individual needs of each customer by manufacturing new types of alloys. Today RUSAL's plants produce over 80 varieties of alloys. RUSAL is also increasing its sales to the domestic market. In 2004 these increased by 38,000 and accounted for 18% of total sales.

In February a new beverage can plant, ROSTAR-Vsevolzhsk, began operations. The plant's designed annual capacity is 1,700 mln. half-liter cans. Total investment into the plant was $100 mln. With introduction of ROSTAR-Vsevolzhsk the growing demand on the Russian market is now fully satisfied by domestic production. The launch of the new plant strengthened RUSAL's position in the Russian beverage can market. RUSAL's market share rose to 60%.

In 2004 RUSAL took a decision to participate in various power projects to provide the company's smelters with their own power. The first project committed to is in Tajikistan. An agreement signed with the Tajikistan Government in October 2004 will enable RUSAL to participate in the construction of the Rogunskaya hydropower plant. The agreement also includes construction of a new aluminium smelter with a 200,000-tonne capacity and the installation of two new potrooms with 100,000 tonne capacity at Tajik Aluminium Smelter.

In 2004 RUSAL continued consolidation of the company and its buyout of shares from plant minority shareholders. This included the purchase of minority stakes in Krasnoyarsk.

RUSAL's specialists have developed what is currently the most powerful cell in Russia, with amperage of 300 kA. Top Russian research capabilities combined with international experience were used to develop the cell. The cell is capable of producing over 2,050 kilos.

In 2004 RUSAL completed its program to outsource auxiliary services. Seven subsidiaries have been created to take responsibility for repair and maintenance of technological and energy equipment at RUSAL's smelters and alumina refineries. This facilitated reduced repair time and costs.

Creation of aluminium and alumina divisions completed the company's structural optimization and enabled streamlining of the management of aluminium and alumina plants of the group. Introduction of SAP R/3 system at Krasnoyarsk helped to further optimize financial operations, supply management, data analysis, decision-making processes and business planning. The next step will be introduction of SAP R/3 in the Moscow headquarters and then at all RUSAL facilities.

Financial highlights

2004 was a favourable year for the metallurgical business. It was characterized by stable high prices and steady demand for aluminium on the one hand, but higher power prices and a weak dollar on the other. These factors were reflected in the company's costs. RUSAL's revenues increased by 20% to $5.4 billion from $4.5 billion in 2003, resulting from increased LME aluminium prices, as well as a continuing rise in RUSAL's aluminium output and improved product mix. The company's revenues in international markets in 2004 increased 16% over 2003 and amounted to $4.3 bln. The company's sales on the domestic market increased by 32.5% year on year and amounted to $1.1 bln. Investments in 2004 increased to $534 mln from $284 mln in 2003. Investments in modernizaion in 2004 amounted to $278 mln versus $180 mln in 2003.

In 2004 RUSAL closed the syndication of an $800 mln term loan facility for pre-export financing. This loan is the largest loan facility ever obtained by a mining/metallurgical company in Russia.

Outlook for 2005

Growth will remain the main strategic focus in 2005, and RUSAL will continue to look for merger and acquisition opportunities in both the alumina and aluminium sectors. In 2005 RUSAL is planning to invest about $1.5 bln in growing its business.

RUSAL will concentrate on the following projects in 2005:

• Preparatory work for a new aluminium smelter in Irkustsk will continue, with construction due to start in 2006.
• A feasibility study to build a new alumina refinery at the Severnaya Onega bauxite deposit will begin.
• The Armenal plant will recommence production following a comprehensive modernization programme.
• The development of a new RA-400 cell will be completed.
• Construction will begin on the Rogunsk power plant (Tajikistan).
• Expansion of the Nikolaev and Achinsk refineries to 1.6 and 1.2 mln tonnes respectively, will begin.
• A feasibility study to expand the Friguia alumina refinery (Guinea) will be completed.

2004 Highlights

Investments

• Commencement of a feasibility study to build a new 600,000-tonne smelter in the Irkutsk region;
• Preparatory work to build the 350,000-tonne Khakassk aluminium smelter began;
• Commencement of a feasibility study to double the capacity of the Friguia refinery in Guinea.

Modernization and technological upgrade

• Commencement of $ 70 mln modernization program at ARMENAL foil mill;
• Casthouse area modernization at Krasnoyarsk began;
• First stage of reconstruction of the casthouse area at Sayanogorsk smelter was completed and will increase the annual billet capacity from 30,000 to 80,000 tonnes;
• Nikolayev alumina refinery reached 1.3 mln tonne capacity.

Environment

• RUSAL continued ISO 14001 environmental certification of its plants, with Achinsk and Nikolayev Alumina Refinery, Bratsk and Krasnoyarsk Aluminium Smelter receiving certification in 2004. Eight of RUSAL's production units are now ISO 14001 certified and those remaining are awaiting certification.
• As part of the Bratsk Smelter modernization all 25 potrooms were transferred to dry anode technology.
• Potroom No. 10 at the Krasnoyarsk Aluminium Smelter has been successfully transferred to dry anode technology. RUSAL plans to transfer all the potrooms at Krasnoyarsk to dry anode technology, which will substantially reduce emissions. 16 potrooms at Krasnoyarsk are already using this technology.

* Reduction due to temporary closure of ARMENAL foil mill for modernization.

For International Press

Zhenia Harrison
zharrison@rusal.ru

For Russian Press

Vera Kurochkina
Elena Shanina
Press-center@rusal.ru