Results of annual General Meeting of OJSV "Mangistaumunajgaz" (Kazakhstan) shareholders

/KASE, Sep.29, 99/ - OJSV "Mangistaumunajgaz " (Aktau, official list of securities, "A" category) according to listing requests provided Kazakhstan Stock Exchange (KASE) with the protocol of the General Meeting of shareholders on results of 1998 including the reports of Board of directors and Auditing committee. On the annual General Meeting, which was held on September 29, 1999, the Mangistaumunajgaz shareholders have heard and have ratified: - The reports of the Board and Auditing committee about results of company activity in 1998; - 1998 annual financial reporting and Arthur Andersen (Almaty, Kazakhstan) audit report; - Changes, offered by the Board, in the articles of association; - The Board offering do not add the simple shares dividends in connection with the absence of net produce by 1998 results; - Final size of preference share dividend by 1998 results - 100 tenge, the date of dividends payment closed - December 24, 1999; - Appointment of the Mangistaumunajgaz Auditor for 1999 firm (Arthur Andersen). Also Board of directors of the company of 6 persons was elected by the General Meeting: - Abishev Salimzhan Karaevich - Central Asia Petroleum Ltd. main technical manager; - Ginatulin Jurij Midhatovich - Central Asia Petroleum Ltd. executive director; - Krymkulov Sagyn Erkasovich - Mangistaumunajgaz General director; - Krikbaev Bolat Serikbaevich - main expert of State Property and Privatization Committee of the Ministry of Finance of Kazakhstan; - Sarsenov Rashid Temirbulatovich - chairman of Board of the company Central Asia Petroleum Ltd.; - Saddiki Ahmad Ikubal' - adviser of the company Central Asia Petroleum Ltd. In the report of Board (lecturer - Krymkulov C.E.) is spoken, that during accounting period the main efforts were directed on overcoming of the 1998 crisis connected with catastrophic reduction in the world oil prices. Within the year the company extracted 3.347 million tonnes of oil or 76.9% from the planned volume (4.350 million). The main decrease of production - 990,000 tonnes or 99% has taken place on the largest of deposits - Kalkamas and Zhetybai. Among major factors of default are named: - restrictions in the electric power - losses of oil about 169,000 tonnes; - frequent KazTransOil (the national oil transportation company) restrictions for oil reception, which caused in necessity of oil production and finally loss of 515,000 tonnes; - default of the scheduled geological-technical measures on Zhetybai deposit group, therefore the losses in production have made 364,400 tonnes. Besides in 1998 under the court decision 48,000 tonnes were withdrawn from the company's balance for debt servicing. At the same time, as a result of transfer of 13 holes on the mechanized production, additional volume of oil 5,440 tonnes was received. The additional production received as a result of optimization of mechanized holes operations, has made 17,236 tonnes, that is 2 times more, than in 1997. In the report is marked that the constant attention was directed on increase of quality of production: from 3.330 million tonnes of handed oil, over 2.241 million (67.3%) was of premium quality. Total in 1998 from Mangistaumunajgaz resources 3.350 million tonnes of oil were delivered (by 79% or 880,000 tonnes less then planed), from them: - for a home market - 2,028 million (97.5% from the plan); - for export - 1,027 million (81.54% from the plan), including: - in non-CIS countries - 841,500 tonnes or by 77% more than scheduled; - in CIS countries - 186,000 tonnes or 23.7% from scheduled volume (as a result of fall in prices the Russian and Ukrainian refinery were overstocked). 246,000 tonnes (27.65% from scheduled volume) were shipped through port Aktau (which is connected with fall of the quotations, large costs at shipments through port and, as a consequence, bad f.o.b. conditions). Investments in 1998 - 651.0 million tenges, fixed assets entered into operation 810.0 million tenges, decrease of uncompleted construction - 159 million tenges. More than 360 million tenges were spent for the ecology measures. The actual operating and sale expenses in 1998 have made 10.1 billion tenges (at planed 11.9 billion) and in comparison with a 1997 (14.3 billion) have decreased by 29.4%. As a result more than 1.5 billion tenges of accounts receivable was redeemed. On the Meeting date the company in common with the strategic investor Central Asia Petroleum Ltd. almost cancelled the wages indebtedness, which by the beginning of 1999 was 2.227 billion tenges. According to the report of Board in the year in connection with austerity policy and also with the purposes of increase of effectiveness some structural were carried out: - the branches and Almaty representation were liquidated (part from them was transformed into other kinds of divisions); - the amount of affiliated companies was shorted by means of association of divisions of the same character; - some workshops cancelled in connection with transfer of services, executed by them, to the specialized affiliated companies. In result the management staff of the liquidated structures and small part of the attendants were discharged, but all production workers places were saved. Besides the objects of social sphere which are a state ownership (children's gardens, hostels, hospital complex) were transferred into balance of local executive bodies.