LUKOIL LAUNCHES PRODUCTION AND SALES OF EURO-4 DIESEL FUEL

Friday, June 17, 2005

LUKOIL is the first Russian oil company to have commenced a large-scale production of low sulfur environment friendly diesel fuel (LUKOIL EURO-4) and launched it to the market. The fuel meets the European environment requirements for EN-590:2004 (Euro-4) diesel fuel.

LUKOIL EURO-4 diesel fuel is produced by the Company’s refineries LUKOIL-Permnefteorgsintez – 200-220 thousand tons per month, LUKOIL-Nizhegorodnefteorgsintez – 120-150 thousand tons per month, and LUKOIL-Ukhtaneftepererabotka – 20 thousand tons per month. LUKOIL EURO-4 production line has winter and summer types of diesel fuel.

LUKOIL EURO-4 contains only 0.005% of sulfur which is 40 times as lower as specified by the Russian GOST 305-82 standard.

Apart from the enhanced operational parameters extending the engine lifetime, LUKOIL EURO-4 decreases the exhaust volumes by more than a half.

In accordance with the general development plan for the LUKOIL Group refineries, Euro-4 diesel fuel production may rise to 10.6 million tons per year by 2014.

The upgrade investments into the Russian refineries of the Company are scheduled to reach about $2 billion by 2014 in order to increase production of the quality oil products.

Disclaimer

Certain information in this press-release may contain anticipated operating and financial data. The Company will not hold any obligations as per achieving the stated results due to risks and uncertainty the Company may not foresee. Factual results may differ from those stated in the official plans of the Company’s development prospects.