VOLGA-DNEPR AIRLINES LANDS LUKOIL SIBERIA CONTRACT

March 17, 2003, Moscow- Volga-Dnepr Airlines, the international market leader in outsize air cargo transport, has started a series of flight carrying oil and gas extraction equipment for Lukoil, Russia's largest oil company. The first flight's 90-ton cargo was delivered from Calgary, Canada to Usinsk, Komi Republic in Siberia. Further deliveries in the programme of Volga-Dnepr flights for Lukoil will be from Manchester, England and Ankona, Italy to Usinsk.

Volga-Dnepr Group maintains the leading position in oil and gas equipment transportation. In its 12-year history Volga-Dnepr has carried over 23,000 tons of oil/gas industry equipment, in more than 300 flights to different regions of the world. Among the major customers are British Petroleum, Calgary Overseas, Canadian Oxy Offshore International, and Exxon Mobile.

Incorporating Volga-Dnepr's An-124-100 services into its logistic chains enables the world's industrial corporations to shorten launch of production and thus gain additional advantages in competition. A good example is co-operation between Volga-Dnepr and British Petroleum. In 1996 quick and high-quality transportation of oil and gas extracting equipment to Columbia by Volga-Dnepr freighters allowed British Petroleum to start oil field production several months earlier than was originally scheduled. Within a year and a half more than 120 flights were performed and more than 11,000 tons of equipment were delivered. According to experts, total economic effect for British Petroleum amounted to more than US$200 million.

The An-124-100 outstanding payload of 120 tons together with Volga-Dnepr's unique loading-unloading technologies enable the aircraft to carry most of the industrial equipment without dismantling. Using Volga-Dnepr as part of the oilfield set-up logistics chain is therefore extremely cost-effective and is in increasing demand in the oil/gas industry.

The total volume of the super-heavy and outsize cargo transport market in 2002 was US$340 million USD. Volga-Dnepr Group maintained its leading position with a market share of 50%, 3% higher than in 2001. Volga-Dnepr's major customers in 2002 included some of the world's largest companies and corporations such as Exxon Mobile, Boss Airchartering, Hitachi Power & Industrial Systems, BAE Systems, Bombardier and Shorts Brothers, Lockheed Martin, and national Governments and agencies of Australia, the USA, UK, Italy, Spain, Germany and others.

The Volga-Dnepr Group today includes aviation, insurance, road transport and educational businesses. The Group's companies successfully work on the three continents: in UK, USA, China, Ireland, the United Arab Emirates and Russia. The Group's activities are aimed at marketing the unique transportation services of the An-124-100 internationally. The fleet consists of nine An-124-100s with a tenth aircraft on order. The Group has 1,200 employees from all over the world.