About SUEK AG

SUEK AG was established in December 2004 as the exclusive exporting company of Open Joint Stock Company “Siberian Coal Energy Company” (OJSC “SUEK”), the Russian largest coal producer.

We are the biggest supplier of the Russian steam coal to the international market. SUEK AG delivers coal to more than 30 countries all over the world. Thereat, we prefer to develop direct relationships with consumers of coal. As a result, more than 70% of our sales are made directly to the end-users.

Principally, the origin of coal we deliver is Kuzbass region, however several production units in Khakassia, Buryatia and Khabarovsk region contribute to the exporting of coal as well.

Referring to the figures, about 23.8 mio mt were sold in 2007 (including traded tonnage) and the outcome of 2008 was about 25.8 mio mt. Our expectations for 2009 is about 26.5 mio mt.

In addition to sale of the Russian coal, which is produced by the enterprises operated by OJSC “SUEK”, we are effecting trade in coal of other Russian coal producers and coal of non-Russian origin since 2007. In 2008 there was traded of abt 0.5 mio mt of non-Russian coal and abt 1 mion mt of coal of other Russian producers. We have in our portfolio Indonesian, Australian, Chinese and Columbian coal.

We arrange deliveries to be effected both by sea and rail, mainly on the basis of the following terms:

FOB - loading port;
FOB - barge ARA;
CIF/CFR - discharging port;
DES - discharging port;
DAF - cross border station.

Moreover, SUEK AG is the biggest charterer among Russia-related suppliers of coal. We chartered about 14.2 mio mt in 2007 and about 14.3 mio mt in 2008. Our major concern in charterring is the Atlantic region where SUEK AG provides for more that 90% of all its seaborne sales to be effected on CIF and DES terms.

The implementation of the price risk management permits SUEK AG to manage its exposure to the coal and freight markets and optimize its growing portfolio. Further development of the derivatives market appears to be inevitable and it is our intention to act accordingly.

Besides high quality of coal which is the must, doing our business, whether physical sales or paper trading, we adhere to the following principles:

direct relationships with consumers;
long-term cooperation;
individual approach to consumers’ needs;
high level of service and reliability.