The LUKOIL-Garant non-government pension fund whose members comprise 31 affiliated companies of LUKOIL became one of the first Russian non-government pension funds to conduct an actuary evaluation, or an independent audit of its financial reliability by international standards.

The actuary evaluation of LUKOIL-Garant was conducted by international consultants Calland Consulting Ltd. in cooperation with the Inspection of Non-Government Pension Funds of the Ministry for Labor and Development of Russian Federation under a project carried out by the Now How British Government Fund.

The Calland Consulting Ltd. statement says that the current financial situation of LUKOIL-Garant is characterized as stable and the pension fund possesses sufficient reserves to weather a situation in case the fund performance results turn to be worse than expected.

LUKOIL-Garant was registered in July 1994 and has been operating under license #11 issued by the Inspection of Non-Government Pension Funds. A highly professional investment company LR-Invest is the asset manager of the fund. Thanks to LR-Invest LUKOIL-Garant could avoid financial losses under economic and financial crisis conditions. LUKOIL-Garant’s equity substantially surpass its debt. This guarantees stable payment of pensions. The fund’s reserves are estimated at 1,480 million rubles. LUKOIL-Garant ranks first in the official rating of major pension funds of Russia by market capitalisation of its assets and the equity/debt ratio.

Presently more than 1,000 of former LUKOIL employees, residents of Moscow, Perm, Chelyabinsk, Volgograd region and Krasnodar region are paid additional non-government pensions. In 1998 LUKOIL-Garant plans to pay 4.5 million rubles in additional pensions. Depending on the time of overall life employment, duration of employment with LUKOIL and contribution in the Company’s development the pension size varies and reaches 3,500 rubles.

At the end of 1998 LUKOIL-Garant will start paying pensions to 67 employees of LUKOIL-Kaliningradmorneft who are retiring soon. In 1999 1,200 people more will be paid pensions by the fund. Besides, the fund has also worked out a non-government retirement program for LUKOIL employees who are seconded to the Company’s overseas joint ventures.

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