Moscow. May 5, 2005. Sibneft continued to expand its resource base and moved into new exploration territory today, winning two open subsurface resource auctions.  The company acquired licenses to explore and develop the Srednetaimurinskiy block in Krasnoyarsk region in Eastern Siberia, as well as the Zimniy block in Tyumen region in Western Siberia.

The Srednetaimurinskiy block in Krasnoyarsk is Sibneft’s first license in Eastern Siberia, one of the most promising undeveloped oil provinces in Russia.  The company will pay 27.5 million rubles ($989,579 at today’s exchange rate) for the license area, which has geological resources of 166.9 million tons of oil and 429.7 billion cubic meters of gas (1.22 billion barrels and 15.2 trillion cubic feet, respectively). 

The Zimniy block in Tyumen is located along existing pipeline networks and has recoverable oil reserves (categories C1+C2+C3) of 8.66 million tons (about 63.2 million barrels) and additional recoverable oil resources of 6.94 million tons (50.7 million barrels).  Sibneft agreed to pay 828 million rubles ($29.8 million) for the license, which equates to $0.47 per barrel of reserves or $0.26 per barrel of recoverable resources.

“Today’s field acquisitions represent more than new additions to our resource base,” said Sibneft president Eugene Shvidler. “They demonstrate our efforts to broaden our geography from our traditional base in Western Siberia when assets that meet our investment requirements become available.”

Contact:

John Mann

Sibneft

Tel:  +7 (095) 777-3116, 777-3182

Fax: +7 (095) 777-3114

JohnM@sibneft.ru

www.sibneft.com