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Company Presentation “Supplying the infrastructure for Russian oil & gas expansion”

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Chelpipe today is the most modern Russian tube & pipe producer with a value-add OFS platform

Note: LDP = Large diameter pipe, defined as Ø of 508-1,420 mm with one or 2 welded seamsOCTG = Oil country tubular goods, wide variety of Ø seamless pipe

TPS divisionPipe division

OFS division

Pipeline bends and hubs

Electric submersible pumps (ESP) & motorsRange of OFS services

Pipeline construction

solutions

Oil & gas extraction/

delivery solutions platform

LDP

OCTG

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Chelpipe benefits from integrated facilities that are strategically located in the industrial heartland of Russia

State-of-the-art new and

modernised production

facilities

Chelpipe production and distribution network

Source: Company data

OCTG & Industrial pipe manufacturing,

Pervouralsk

Electric submersible pumps and motors– ESP capacity: – ESM capacity:

DudinkaUsinsk

Nyagan

Kogalym

NizhnevartovskPervouralsk

Over 25,000 types of tube & pipe– Seamless capacity: – Welded capacity:

New Finishing Center New steel mini-mill

Pipeline bends– Hot bends capacity:

7,500 t

TPS manufacturing,Chelyabinsk

In-house scrap capacity up to 1.5 mil ton per year

Scrap collection & processing, Ural and Volga regions

Distribution network, 12 regions

OFS manufacturing,Almetyevsk

TPS: Production units

OFS: Drilling and geophysics

OFS: Service centers

Pipe: Production units

OFS: Production units

(ALNAS Service)

LDP & Industrial pipe manufacturing,

ChelyabinskNefteyugansk

Strezhevoy

Khanti-Mansiisk

Surgut

IzhevskAlmetyevsk

Burguslan

Fully owned warehouse and trading house network– 17 warehouses– 12 trading houses

Magnitogorsk

Moscow

Ukraine

Kazakhstan

Russia

St-Petersburg

Chelyabinsk Over 3,600 types of tube & pipe

– Welded capacity: – Seamless capacity:

New LDP shop– Capacity: 600 kt

6,900 units7,200 units

950 kt100 kt

1,000 kt 350 kt

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Chelpipe — Russia’s most modern pipe mill and integrated tube & pipe service provider for the oil & gas industry

Strong future growth trajectory

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Unique platform of pipe and OFS

products/services

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Experienced management team

with modern business practices

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Successfully completed transformational modernisation and acquisition strategy − state-of-the-art

asset base

1

Fast growing end-markets and attractive

industry position

2

Widest product platform with

unique capabilities

3

Blue-chip customer base with focus on

Russian oil & gas

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Low cost position supported by strategic location

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5

M&A growth strategy

Comprehensive investment program

Modernisation and formation of Chelpipe GroupIntegrated pipe mill with value-add OFS

offering

The Future…

Well-invested asset base as a result of a comprehensive investment program and a successful M&A strategy

2002

2002 to 2009 – modernisation

Reconstruction of existing shops

2009 – OCTG expansion

Commission new state-of-the-art

Finishing Center at PNTZ

2010 – LDP expansion

Commission new, state-of-the-art

0.6 mil ton LDP mill at Chelpipe

2010 – vertical integration

Commission new 1 mil ton state-of-

the-art EAF

Acquisition of PNTZ (2004 initial stake and 2006 remaining stake)

Acquisition of scrap supplier

Acquisition of ALNAS pumps and other OFS

service providers

2004 and 2006 – OCTG segment

entry

2008 to 2009 – vertical

integration

2008 – OFS segment entry

2010 – Bends platform

consolidation

Acquisition of TPS division1

2011 to 2012 – complete OFS modernisation and integration

Chelyabinsk Pipe Rolling Plant

Start transformation with $50 mil EBRD loan

Complete pipe, tube & OFS solutions provider

Vertically integrated, quality & cost leader

Reconstruction and expansion of ALNAS

facilities

Integration of OFS platform into group

2002

2011–2012

2004 2006 2008 20092010

1 Was acquired from an affiliate of Chelpipe and certain members of its Board of Directors and management were also members of Chelpipe’s management and Board of Directors before the acquisition

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Most modern LDP shop in Russia with 18 key structural cost advantages designed into the 600 kt mill

Entry into new 1.42 m Ø one seam segment with up to 18 m length and 45 mm wall thickness

Strategic agreement with MMK – high-quality steel plate supplier Employees follow “white coat metallurgy” practices

LDP mill “Vysota 239”

ChelPipe has invested about $1.8 billion to create Russia’s most modern and integrated pipe and tube making complex

State-of-the-art pipe making in the 21st century

Own scrap network (+60 yards) with capacity up to 1 mil ton per year

Creates cost advantage vs. market purchases of ~$100 per tonMetal scrap yard

Own 1 mil ton electric arc furnace, casting high quality round billet for seamless pipe production

Significant expected cost advantage vs. market purchase of over $100 per ton

Running at world-standard labor efficiency with 318 employees1 mil ton EAF –Pervouralsk

Upgraded and expanded our OCTG product range

Full capabilities for quenching, tempering, threading, coupling production and sealing of joints

Capability to develop premium connections for growing Russian market

Finishing Center –Pervouralsk

Strong revenue growth through new capacity and products with higher unit prices

Significant cost reduction through backward integration for seamless pipe

Note: Capital expenditure calculated with average FX rate of 1$=28.66RUB (2007-2010); total figure includes remainder of 5 bil RUB contracted for 2011 (exchange rate used 1$=31.10RUB) 8

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LDP “Vysota 239” shop – production of state-of-the-art LDP portfolio

New LDP “Vysota 239” shop in Chelyabinsk

“Vysota 239” benefits from 18

different cost advantages that ensure ability to

reduce mill costs over time

Most modern Russian LDP mill

State-of-the-art technical configuration and production facilities– Capacity: 600,000 ton per year– Employees: 1,000

Expands product offering platform for Russia’s oil & gas companies – One of two LDP producers in Russia with all three

technical capabilities Diameter up to 1,420 mm Length up to 18 m Wall thickness up to 45 mm

Launch: July 2010; full ramp-up: 2011 (coating line to be completed by 2012)

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Finishing Center – high-margin, value-add product line expansion

New Finishing Center at PNTZ, Pervouralsk

Provides world class OCTG

product quality

Source: Company data1 Converted into $ at average exchange rate of 1$=30.05RUR in H1 2010

State-of-the-art technical configuration– Capacity: up to 115,000 ton per year (40,000 ton line

pipe for oilfield applications and 75,000 ton tubing and casing)

– Employees: 625

Modern, cost-efficient production facilities

Expands product range – including high-margin, value-add finishing, i.e. corrosion resistance, heat treating, enhanced threading capabilities, couplings– High margin products – ~ $1,1001 price per ton in H1

2010 Launch: May 2009; full ramp-up: during 2010

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Low cost billet producer – minimal employee number compared to existing Russian steel mini-mills– Employees: 318

Vertical integration of billet production supported by in-house scrap supply capabilities

Substantial raw material cost savingsLaunch: October 2010; full ramp-up: 2011

Steel mini-mill with 1 mil tons annual capacity – vertical integration and production cost reduction

New steel mini-mill in Pervouralsk

State-of-the-art technical

configuration and production

facilities in line with international

safety and environmental

standards

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We have the broadest product spectrum of all Russian mills with a range of unique capabilities

Russian market pipe demand breakdownChelpipe’s pipe end-market breakdown

SeamlessWelded

Pipe

dia

met

er

Large-Ø1,420 mm

Unique hair-thin

Ø~0.3 mm

One seam LDP up to 45 mm wall thickness, 18 m long

High pressure and corrosion resistant Inside and outside coated,

Wide Ø for oil & gas applications globally

Unique boiler pipe for power plants

Plane and spacecraft fuselage Unique helicopter blades Fluid tube for medical and

aerospace/defense applications

Strong base in oil & gasDiversified exposure across manufacturing sectors

Oil & gas56%

Equipmentmanufacturing

15%

Construction / maintenance

12%

Power 4%

Chemical andpetrochemical sector 2%

Other 11%

Chelpipeproduct range

90%

With new investments we can cover nearly all types of pipe demanded in Russia

Market share gains for Chelpipe in Russia

Chelpipe pipe product range

LDP24%

OCTG¹25%

Welded industrial34%

Seamless industrial7%

Range of construction and bearing products

Automotive Capital goods

Full product range for utilities

Other²10%

Source: Company data Source: Metal Bulletin Research, Russian Pipe Industry Development Fund¹ Includes 7% of seamless line pipe for OCTG applications and 18% OCTG (casing and tubing)² Includes drilling pipes, medium diameter welded pipes, cast iron pipes, cracking pipes

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We serve a blue-chip Russian customer base with over 50% exposure to Russian oil & gas

National Russian oil and gas pipeline operators

Power and chemical industry

Nuclear

Aerospace

Automotive

Utilities

Industrial and energy customers

Range of unique special products

Full certifications for nuclear and power plant construction

Russian oil and gas companies

Long-standing relationship with Russian oil & gas sector

Participate in most major programs

All currently produced pipe and OFS products are industry accredited and approved by oil and gas companies

Over 50 year relationships

We enjoy a strong market reputation with 75% of pipelines constructed in the Soviet Union originating from our mills

Pipe customer breakdown by revenue

Source: Company data

Source: Company data

Transneft 17%

Rosneft 17%

Gazprom 15%Surgutneftegaz 8%Tatneft 4%

Lukoil 3%

Other 35%

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Our TPS and OFS divisions provide extensive cross-selling opportunities in high-margin products

With our TPS division we intend

to leverage the strength of our

LDP products to generate

additional high margins

With our OFS division we

leverage our oil & gas pipe customer base and build on

our strong historic position

TPS Overview Strong potential growth factors

High value-add pipe bend produced in own shop

High-price pieces, each to unique specifications

Capacity of 7,500 ton of hot bends p.a.

Leverage knowledge of pipeline design to supply high margin pieces specific to each project

Significant growth prospects and strong position on new pipeline projects

Chelpipe has unique offering as only 3 close peers exist in Russia for hot bends and hubs

OFS Overview Strong potential growth factors

Historically largest Soviet ESP manufacturer

Strong brand reputation and service business with 6,000 wells under management

Strong capabilities to produce wide power range of ESPs (from 18m3 to over 500m³ daily output)

Intention to grow market share in Ni-resist cast iron pumps – Full new casting production line for Ni-resist cast

iron pumps already arrived at plant Improved product mix and Ni-resist segment

expansion with well known brand and only 2 main competitors

Sales to current customers using existing sales force

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6 Russian oil & gas production and economic recovery fuel strong pipe demand

ChelPipe pipe sales volume (kt) Market CAGR 2009A – 2013E

9.6%1,2

5.3%1

12.8%1

8.1%1

LDPNew pipeline constructionRenewal of existing pipelinesFuture opportunities

OCTG:Oil productionCAPEX of oil majorsRussian drilling activity

Industrial seamless and industrial weldedMacroeconomic drivers: GDP, infrastructure construction, industrial productionPower generation capacity construction

530

908943

LDP OCTG1 Seamless industrial Welded industrial

Source: Company dataNote: Q3 2009 determined by subtracting H1 2009 from 9m 2009 and Q3 2010 determined by subtracting H1 2010 from 9m 20101 Tubing, casing and line pipe for OCTG applications2 Pipe volume is not accounting for intercompany pipe sales between ChTPZ and PNTZ; Consolidated figures are 1,839 kt in 2007, 1,473 kt in 2008, 527 kt in H1 2009, 819 kt in 9m 2009, 291 in Q3 2009, 1,113 kt in 2009, 708 kt in H1 2010, 1,065 kt in 9m 2010 and 357 kt in Q3 2010

Source: 1 Metal Bulletin Research2 CAGR 2010E-2013E – 9.6%, growth 2009A-2010E – 54.2%, CAGR 2009-2013E of 19.4%

843

631 601

717

54.2

%1,2

2007A 2008A 2009A H1 2010A

4,595

5,508

3,823 2,845 2,403

5,681 4,596 2,053

Pipe2

(kt)

Hot bends(kt)

ESP(units)

+19%

Q3 2010A

1,357

971

+23%

357

291

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ChelPipe key financials, IFRS-consolidated ($mil)

2007A 2008A 2009A H1

2009A 9m

2009A

2009A2 H1

2010A 9m

2010A Q3

2010

Pipe volume (kt)1 1,851 1,475 1,131 530 821 1,131 717 1,074 357

Pipe volume % growth2 6.7% (20.3%) (23.3%) (53.2%) 55.0% 37.7% 19.2%5 49.8% - Avg. pipe selling price 1,441 1,668 1,180 1,169 1,233 1,180 1,501 1,551 1,651

Avg. pipe selling price % growth2 11.5% 15.7% (29.3%) (0.9%) 5.5% (4.3%) 30.1%5 3.3% -

Revenue 3,157 3,040 1,767 826 1,285 1,767 1,253 1,961 708

% growth2 40.9% (3.7%) (41.9%) (53.2%) 55.5% 37.5% 33.2%5 56.5% -

EBITDA reported3 457 (123) 153 51 136 153 305 440 135

% margin 14.5% (4.0%) 8.6% 6.2% 10.6% 8.6% 24.3% 22.4% 19.0% EBITDA adjusted4 476 301 265 128 223 265 256 414 159

% margin 15.1% 9.9% 15.0% 15.5% 17.3% 15.0% 20.4% 21.1% 22.4% EBIT adjusted4 421 220 191 94 170 191 213 349 136

% margin 13.3% 7.2% 10.8% 11.3% 13.2% 10.8% 17.0% 17.8% 19.3%

Capex 341 498 358 162 265 358 177 283 105

2007 – expansion year when Russian pipe industry reached peak production

Until mid-2008 ChelPipe on track

Growth resumed during 9m 2010

6 ChelPipe’s 9m 2010 results show strong improvement in performance

Source: IFRS accounts, Company dataNote: P&L items converted at average exchange rates of 1$=25.55RUB in 2007, 1$=24.87RUB in 2008, 1$=31.74RUB in 2009, 1$=33.27RUB in H1 2009, 1$=32.58RUB in 9m 2009, 1$=30.05RUB in H1 2010, 1$=30.18RUB in 9m 2010; Q3 2010 determined by subtracting H1 2010 from 9m 20101 Pipe volume is not accounting for intercompany pipe sales between ChTPZ and PNTZ; Consolidated figures are 1,839 kt in 2007, 1,473 kt in 2008, 527 kt in H1 2009, 819 kt in 9m 2009, 1,113 kt in 2009, 708 kt in H1 2010, 1,065 kt in 9m 2010 and 357 kt in Q3 20102 Growth in H1 2009 vs. FY 2009, 9m 2009 vs. H1 2009, FY 2009 vs. 9m 2009, 9m 2010 vs. H1 20103 EBITDA reported as defined by ChelPipe in IFRS accounts4 EBITDA calculation adjusted for impairment of assets, losses/gains on disposal of assets and subsidiaries, excess in share of net assets acquired in a subsidiary over purchase consideration, foreign exchange loss, share of profit of associates, other financial income/costs; Adjusted EBIT = Adjusted EBITDA – Depreciation & Amortisation

2007: Impairment of assets of $18 mil, loss on disposal of assets of $4 mil, excess in share of net assets acquired in a subsidiary over purchase consideration of $3 mil, foreign exchange gains of $0.5 mil, other fin. costs of $0.5 mil2008: Impairment of assets of $372 mil, loss on disposal of assets of $7 mil, gain on disposal of subsidiary of $3 mil, excess in share of net assets acquired in a subsidiary over purchase consideration $4 mil, foreign exchange loss of $62 mil, share

of profit of associates of $11 mil, other financial costs of $0.3 mil2009: Impairment of assets of $82 mil, loss on disposal of assets of $4 mil, gain on disposal of subsidiary of $3 mil, foreign exchange losses of $30 mil, share of profit of associates of $0.4 mil H1 2009: Impairment of assets of $64 mil, gain on disposal of assets of $0.1 mil, foreign exchange losses of $13 mil, share of losses of associates of $0.02 mil

9m 2009: Impairment of assets of $72 mil, gain on disposal of subsidiary of $3 mil, foreign exchange losses of $12 mil, share of losses of associates of $0.01 milH1 2010: Impairment of assets of $(6) mil, loss on disposal of assets of $1 mil, gain on disposal of subsidiary of $2 mil, foreign exchange gains of $48 mil, share of losses of associates of $3 mil

9m 2010: Impairment of assets of $(10) mil, loss on disposal of assets of $2 mil, gain on disposal of subsidiary of $2 mil, foreign exchange gains of $21 mil, share of losses of associates of $3 mil5 Growth in H1 2010 vs. H2 2009; H2 2009 determined by subtracting H1 2009 from FY 2009; Pipe volume for H2 2009 was 601kt, avg. pipe selling price $1,154 and revenue $940 mil

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Integrated cross selling product platform with leading market share and global low cost position

TPSLDP OFS& +

Positioned for future outsourcing trend – global cost pressure will require Russian oil & gas companies to be more efficient and to seek outsourcing opportunities

Prepared for new oil & gas environment requiring higher product quality

Complete pipe, tube and OFS solutions provider with a 25% target share in Russian oil & gas markets

Vertically integrated, quality & cost leader

Complementary productplatforms

OFS provides additional product entry into the oil supply chain

Target

&OCTG