OAO SUAL, part of SUAL Group, one of the world's top ten aluminium producers and the Volkhov Aluminium and Pikalevo Alumina subsidiaries of OAO Metallurg, have begun the process of merging their assets. By the end of 2004, it is anticipated that Volkhov Aluminium and Pikalevo Alumina will be fully incorporated within OAO SUAL.

Following extraordinary shareholder meetings of both OAO SUAL and OAO Metallurg, votes representing over 99.9 per cent of shares in both companies were cast in favour of incorporation. To finalise the incorporation of these companies, a joint general meeting of their shareholders will be held to complete the necessary legal arrangements.

The Volkhov and Volgograd aluminium smelters, together with Pikalevo Alumina, were integrated with the production operations of SUAL Group in 2002, following an agreement to merge the aluminium assets managed by the SevZapProm company with those of OAO SUAL. At that time, it was decided to convert shares in Volkhov Aluminium and Pikalevo Alumina (OAO Metallurg) into those of OAO SUAL.

Notes to Editors:

The SUAL Group is a vertically integrated business among the ten largest aluminium producers of the world.

Annually, operations of the SUAL Group:

• Mine some 4.4 million tonnes of bauxite
• Refine more than 2.0 million tonnes of alumina
• Produce over 890,000 tonnes of primary aluminium
• Produce more than 50,000 tonnes of silicon
• Manufacture more than 110,000 tonnes of aluminium products.

OAO SUAL currently comprises five companies: Bogoslovsky Aluminium (BAZ), Ural Aluminium (UAZ), Irkutsk Aluminium (IrkAZ), Kandalaksha Aluminium (KAZ) and Nadvoitsy Aluminium (NAZ). The activities of OAO SUAL are incorporated within the SUAL Group.

OAO Metallurg has two operations — Volkhov Aluminium and Pikalevo Alumina. Together, these businesses produce some 250,000 tonnes of alumina and over 22,000 of primary aluminium annually.