1 November 2008

Shtokman Development AG hereby calls for tender for engineering of Ship Shaped Floating Production Unit for the Phase 1 of Shtokman Gas-Condensate Field Integrated Development Project.

Pursuant to the Resolution by the Board of Directors dated October 20th, 2008, Shtokman Development AG announces the tender for engineering of Ship Shaped Floating Production Unit (FPU) for the Phase 1 of Shtokman Gas-Condensate Field Integrated Development Project.

Two consortiums comprising major international companies (Saipem and Samsung on the one part and Aker, Technip and SBM on the other part) will participate in the tender. All these companies have wide experience in design and construction of highly complex offshore facilities.

According to the Resolution by the Board of Directors the tender for FPU contractor selection shall be on a compensation basis. Such form of tender will allow considerable reduction of the project implementation period and selection of the best engineering solutions, as FEED design documentation will be included in both tender packages.

Mobilization of teams for tender bid packages preparation is scheduled for November 17th, 2008.

Reference information:

Previously the Board of Directors of Shtokman Development AG approved the FPU concept as per the results of studies of the two concepts of the floater (SPAR and FPU).

Despite the fact, that the SPAR concept had certain advantages with regard to several properties, the performed analysis proved that for the purposes of the Shtokman field development FPU concept was more efficient, considering both its operability and safety.

Taking into account the risk of icebergs drift in the Shtokman field area, it was decided, that the floater shall be disconnectable.