BMB Munai Begins Production from Doinnoe-1 Well

BMB Munai's Kazakhstan operating subsidiary, Emir Oil, has commenced regular production and sale of crude oil from its Dolinnoe-1 well. Emir Oil is a license and contract holder for Aksaz, Dolinnoe and Emir oil and gas fields, located near Caspian Sea port city of Aktau, in western Kazakhstan.

The first sale of 100 tons of oil was made in April 2004 following a planned test production of Dolinnoe-1 well. The well is currently test producing at a steady average oil flow rate up to 500 barrels of oil per day (bopd) with a producing horizon pressure of approximately 46MPa. The current sales are directed to the Kazakhstan domestic market. Delivery is made by railroad from storage and loading facilities on the Emir Oil property to an oil refinery in Atyrau. The terms of sale are on a 50% prepayment and 50% net 15 days.

BMB Munai's President and CEO Dr. Alexandre Agaian said, "We are pleased to begin generating revenue from our first producing well; it marks an important step in our company's progress. But more importantly we believe the future looks bright as we continue to implement our development plans. If we are successful attracting desired investment funds we anticipate that our field production can be increased to 3,000 bopd in 2005 and will allow us to begin making oil export to Europe and other markets."