PARTNERS SIGN ESTABLISHLING AGREEMENT FOR NEW MULTI-MODAL CARGO HUB AT KRASNOYARSK

Krasnoyarsk, Russia, December, 3rd 2004: – Senior representatives of KrasAir, Volga-Dnepr Group and the Krasnoyarsk regional government attending the Siberian International Aviation & Space Salon have today signed an establishing agreement to create a managing company for a new ‘Centre of transport logistics’ cargo hub at the international airport in Krasnoyarsk.

Mr. Igor Levitin, Transport Minister of the Russian Federation, and the Governor of Krasnoyarsk region, Alexander Khloponin, both participated in the signing ceremony.

The major goal for the new company is to form an effective working cargo hub at Krasnoyarsk Airport, managing cargo streams from Europe and North America to Asia. The managing company will be responsible for dealing with network delivery, storage, processing of air cargo and mail carried by airlines operating via Krasnoyarsk.

The group will consult with major international storage operators. The managing company team will be formed from highly professional specialists, recommended by KrasAir airline, Volga-Dnepr Group and the regional government’s ‘Centre of transport logistics’. The founders will announce the identity of the new company by the end of 2004.

“There are many clear advantages for the Krasnoyarsk region that will be realized through this project with Volga-Dnepr Group. Here, in the Krasnoyarsk region, the major cargo streams will be focused around this new hub, including from Siberian regions. It is an important customs base and a strategic place for the development of the regional economy. The project has already started with the first flights already completed and the project will be further developed next year,” said First Vice-Governor of Krasnoyarsk region, Lev Kuznetsov.

Mr. Boris Abramovitch, General Director of KrasAir airlines, added: “ The creation of this multi-modal transport hub, based on Krasnoyarsk airport, will enable us to optimize the transport network not only of the Krasnoyarsk region but in Russia in general and will let the main partners of the project deliver new services for the international air cargo transportation market. In 2001, the airline started the realization of the project to create passenger and cargo hubs. Today, Krasnoyarsk airport is a passenger and aviation center, serving passenger and cargo streams, annually enlarging the volume of transportation. This project will connect the main transport routes – tran-siberian and cross-polar routes, North Sea routes via the Enisei river and the motor highway of the region - and will establish Krasnoyarsk as the large centre of logistics for Siberia and the Far East.”

The programme to form the cargo hub at Krasnoyarsk Airport will include the modernization of cargo terminals and other airport facilities and the building of a new cargo terminal to meet all international standards. Work is already under way to implement technical handling equipment to sort cargo at the hub.

Mr Alexey Isaikin, President of Volga-Dnepr Group, said: “Since Volga-Dnepr was created, we have demonstrated our ability as one of the true innovators in the worldwide air cargo transportation market. Participating in the project to create the cargo hub in Krasnoyarsk is another important component of Volga-Dnepr’s strategic plan to establish an effective system for the network delivery of cargo in Russia, based on the development of scheduled cargo transportation and creating cargo hubs.”

At the beginning of November, Volga-Dnepr Group’s scheduled cargo airline, AirBridge Cargo (ABC) commenced regular services via Krasnoyarsk International Airport. Currently, ABC flies to Luxembourg from Beijing and Tianjin (China) via Krasnoyarsk three times per week.

In the future, ABC plans to enter the cargo markets of other Asia-Pacific countries, broadening its route network and increasing the frequency of cargo flights via Krasnoyarsk. During the following 2-3 years, with the introduction of Boeing-747-400F aircraft into the Volga-Dnepr Group fleet, the cross polar routes will be used.

ABC Managing Director, Stan Wraight, said: “By adding Krasnoyarsk to our schedule and developing the system of Russian hubs, we will present to the market a unique product offering quality services between Europe, Asia and North America via Russia as well as effectively distributing cargo in Russia and the CIS.”

In May 2004, AirBridge Cargo completed its first scheduled flight using the airline’s first Boeing-747-200F. In September, ABC added a second Boeing 747-200 to its fleet.