Moscow, 5 August 2004. SUAL Group, one of the world's top ten aluminium producers today announces the successful conclusion of a USD 150m loan from both the International Finance Corporation (IFC), a member of the World Bank Group, and the European Bank for Reconstruction and Development (EBRD), to provide financing for Phase I of the Komi Aluminium Project.

Out of their respective USD 75 million facilities, the EBRD and the IFC will each provide a nine-year loan of USD 45 million, making it the longest credit ever obtained by the Russian metal sector. The remaining USD 30 million portion of each organisation's USD 75 million facility is syndicated to international banks under an A/B loan structure. The term of the syndicated portion will be seven years with a margin of 3.25 per cent over LIBOR.

Commenting on the signing of the credit agreement, Viktor Vekselberg, Chairman of the SUAL Holding Board of Directors, said: «The scale and terms of this loan set a new benchmark for Russia, demonstrating the confidence of world credit institutions in the Russian metallurgy sector and economy in general. Also, the IFC and EBRD praised the quality of SUAL management and the Group's prospects for further development.»

Peter Woicke, IFC's Executive Vice President and Managing Director of the World Bank Group for Private Sector Development, noted that the project could be a milestone in modernising Russian industry. He also expressed pleasure that SUAL intends to complete the project to the highest international standards and is doing so in close consultation with the local community.

Noreen Doyle, EBRD First Vice President, said: «Throughout the negotiations SUAL Group's management demonstrated clearly an understanding of the need for transparency, high standards of business conduct and improved environmental protection, and this played a large role in helping this deal set a new benchmark for the Russian metal sector».

The signing of the agreement is the final procedure required for dispatching the credit facility for Phase I of the Komi Aluminium Project. In June last year SUAL Group mandated the IFC and EBRD to negotiate financing. Before then, when the boards of both credit institutions approved the financing for the expansion of the Middle Timan bauxite mine, the largest in Eurasia, experts from both the IFC and EBRD were familiarising themselves closely with the project.

On conclusion of the bankable feasibility studies for construction of an alumina refinery and aluminium plant, the IFC and EBRD will consider participation in the financing of the next phases of the Komi Aluminium Project.

Vladimir Kremer, Komi Aluminium's Director General, stated: «Participation of such serious organisations will have a major impact on the project and will increase significantly its potential, since apart from their tremendous financial capabilities, IFC and EBRD also possess extensive expertise in implementation of world-class projects. Now we can truly say that Russia has such a project».

Notes to Editors

About Komi Aluminium

Komi Aluminium is SUAL Group's project to develop an integrated bauxite/alumina/aluminium complex. The complex is expected to achieve annual production of up to six million tonnes of bauxite, 1.4 million tonnes of alumina and 300-500,000 tonnes of primary aluminium. The Komi bauxite deposit (Timan Bauxite) is already operational and produces about one million tonnes annually.

The first phase of the Komi Aluminium Project envisages gradually increasing production of bauxite from the current one million tonnes to six million tonnes per annum. At the second and third phases, after conclusion of the respective bankable feasibility studies, an alumina refinery in Sosnogorsk and aluminium plant will be constructed.

SUAL Group has already invested over USD 150 million in the project.

About EBRD

The EBRD, owned by 60 governments and two intergovernmental institutions, aims to foster the transition from centrally planned to market economies in central and eastern Europe and the Commonwealth of Independent States. For further information visit the EBRD's website: www.ebrd.com.

About IFC

The IFC's mission (www.ifc.org) is to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people's lives. IFC finances private sector investments in the developing world, mobilises capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses.