LUKOIL purchases 17.5 million of its shares from UniCredit for $980 million

Russia's largest private oil company LUKOIL has purchased 17.5 million
shares from UniCredit Bank for $980 million, using its sister company
LUKOIL Finance Limited.

On Sunday, LUKOIL purchased 42.5 million shares (4.99%) from
ConocoPhillips together with an investment group, headed by UniCredit
Bank. The purchase was carried out by LUKOIL and its sister company
LUKOIL Finance Group from the sister company of ConocoPhillips -
Springtime Holding limited. At the same time LUKOIL Finance Limited
sold the shares of UniCredit. According to the agreement LUKOIL could
purchase 98.728 million shares, equal to 11.61% of the company's
capital. The price per share was $56. The deal is worth $2.4 billion.
The press-service of the company said that the rest of the shares will
be purchased.

The head of Director Board of LUKOIL Valeriy Graifer said that LUKOIL
will purchase the remaining 6% of its shares from ConocoPhillips.

On August 16 LUKOIL purchased 7.6% of its shares worth $3.442 billion
from ConocoPhillips ($53.25 per share). ConocoPhillips was to receive
$6.44 billion. The US company still holds 6.15% of LUKOIL shares.
On Sunday LUKOIL noted that the deal is aimed at increasing profits of
shareholders. Vice-President of the company Leonid Fedun added the
deal allows keeping the quote on stabe level.

The head of LUKOIL Vagit Alekperov said on September 17 that the
company was negotiating with investors, which may become major
shareholders of the company within the framework of realization of the
option, the terms of which expired on September 26. He said that many
investors wanted to become the company's investors.

ConocoPhillips plans to sell the remaining share by the end of 2011 on
open market. The price for each share on free market should be at
least $55 by September 27, 2010. The price should be $53.25 per share
on January 1, 2011. The maximum amount of purchase should not exceed 5
million shares per month using stock exchange, according to the
agreement.

ConocoPhillips declared about sales of half of its LUKOIL shares equal
to 20% in March this year. In the second quarter ConocoPhillips sold
6.7 million shares for $391 million. The net profit was $99 million.

The share of ConocoPhillips dropped to 19.21% (851 million shares) on
July 30 from 20.09% in the first quarter.

In April 2004 ConocoPhillips won the auction purchasing 7.59% of
LUKOIL shares for $1,988 billion ($30.76 per share). LUKOIL and
ConocoPhillips agreed that the US company can increase its share to
20%, and it did in 2006.

The charter capital of LUKOIL is 21.26 million rubles, and it is split
into shares worth 0.025 rubles each. The president of the company
Vagit Alekperov should be the holder of over 20% of the company's
shares, Vice-President Leonid Fedun - approximately 10%.