Sibir Energy Reaches Production Milestone

Sibir announces today that its total crude oil production rate for the week beginning March 27, 2006 averaged in excess of 22,000 barrels per day (bpd), a record high for the company.

Over 15,000 bpd of production is now represented by Sibir's 50% share of output at the Salym group of fields, operated by Salym Petroleum Development, NV ('SPD') - Sibir's joint venture with Shell in western Siberia - which is now producing in excess of 30,000 bpd. Commercial production at the Salym fields began in December, 2005 and is expected to reach 60,000 bpd (30,000 bpd Sibir share) by the end of 2006.

The balance of Sibir's daily production for the week of over 7,000 barrels per day was provided by OAO Magma, a production subsidiary 95% owned by Sibir where production is expected to remain stable at current levels.

Commenting on the achievement of this production milestone, Sibir CEO, Henry Cameron, said, 'As Sibir approaches the tenth anniversary of its activities in Russia, we are very pleased that production at Salym is ramping up according to plan and that the reservoir is performing as expected. This is an important achievement for the company and a testament to the spirit of cooperation between Sibir and Shell that has characterized the work of SPD to date. Sibir will be providing regular updates to the market on the progress of production growth as SPD works towards its year end target of 60,000 bpd (30,000 bpd Sibir share).'