ChelPipe Announces Operational Results and Reviewed IFRS Results for 1H 2011

Joint Stock Company Chelyabinsk Pipe-Rolling Plant (“ChelPipe”), a leading Russian producer of welded and seamless steel pipes and tubes, and supplier of integrated solutions for the Russian oil & gas industry as well as a variety of other industries in Russia, announced its operational results and reviewed IFRS financial results for the first six months of 2011.

1H 2011 HIGHLIGHTS

Sales Volumes:

• Steel pipe sales volumes increased to 1,012 thousand tons, up 41% compared to 717 thousand tons in 1H 2010. Sales volumes of LDP, OCTG and seamless industrial pipes increased by 91%, 16%, and 20%, respectively compared to 1H 2010 (1H 2011: LDP – 521 thousand tons, OCTG – 117 thousand tons, seamless industrial pipes – 280 thousand tons).

• Within trunk pipeline systems, hot-formed bends sales totaled 5,607 tons in 1H 2011, up 133%. Pipeline hub sales volumes rose by more than twenty times and reached 660 tons, sales volumes of ball valves and nuclear valves totaled 3,155 and 107 units, 26% and 47% increase over 1H 2010 respectively.

• Within oilfield services, Ni-resist iron ESP sales volumes totaled 1,057 units, down 23% as compared to 1H 2010. As of 30 June 2011 ChelPipe serviced 7,662 oil wells in Russia, 33% increase over 30 June 2010.

Financials:

• Revenue for the first six months of 2011 totaled RUB 63,109 million compared to RUB 37,646 million for the same period last year.

• 1H 2011 EBITDA amounted to RUB 12,495 million and was equivalent to 20% of revenue, compared to EBITDA of RUB 9,113 million for 1H 2010, equivalent to 24% of revenue.

• Net profit for the first six months of 2011 was RUB 4,155 million compared to a RUB 3,011 million for the first six months of 2010.

The increases in revenue, EBITDA and net profit in 1H 2010 are primarily a result of the strong performance in sales volumes of steel pipes and trunk pipeline systems’ core products arose due to an increase in demand from ChelPipe’s major oil and gas customers.