Statement by the Chairman of the Board of Yukos-Moscow LLC STEPHEN TEEDY in connection with the announcement of an auction for the sale of Yuganskneftegaz OJSC

"This is a sad day for Russia and its people.

Today's announcement was both stunning and expected. Stunning - because it was a clear demonstration of the government's disrespect for the law. Expected - because, given the course of the case, its outcome was predetermined long ago.

NK Yukos has repeatedly stated that the actions taken by the government contain fundamental shortcomings. Namely:

— The sale is undoubtedly illegal, since Russian legislation obliges the sale of non-core assets in order to solve tax problems. Yuganskneftegaz is the heart of Yukos, and its sale would destroy Russia's most efficient oil company, one of those that has attracted the largest amount of Western investment. The President, his administration and the Russian government, ignoring illegal actions, essentially condone them.

“This expropriation makes a mockery of the protection of property rights that the President so eloquently defended last week. The sale was made possible due to the fact that the government completely artificially created a cash crisis for NK Yukos by freezing assets and bank accounts and presenting ridiculous and absurd tax claims that exceeded the company's revenue.

— The starting price of the auction has nothing to do with the true value of Yuganskneftegaz, one of the world's largest oil producing companies, and means the theft of the assets of the Yukos Oil Company. Yukos has been the driving force behind the revival of the Russian oil industry since 1999, largely thanks to the development of Yuganskneftegaz. The sale of Yuganskneftegaz at a reduced price increases the likelihood that the Russian government will continue to steal other Yukos assets by selling them at a false price to match false tax claims.

Since 1991, Russia has slowly but surely moved towards building the foundations of a modern market economy. Today's decision means abandoning this path, and it must be condemned by the world community and international investors.

Essentially, we are witnessing government-orchestrated theft to settle political scores."

"Government-orchestrated theft to settle political scores"