LSRG.L Regulatory News (LSRG)

LSR Group increases its sand reserves

OJSC Rudas (a subsidiary of LSR Group), the largest supplier of sand in St. Petersburg and the Leningrad region, has obtained the right for the six resource sites in the Leningrad region through the auctions held by the Mineral Resources Department of the North-West Federal District. Aggregate reserves of the quarries reach 18 million cubic meters by the Department's estimates.

The company acquired the right to use resources for exploration, geological survey and sand extraction on the following sites:

·; Site "DEU-43", Kingisepsky district of the Leningrad region;

·; Site "Lodvinky 2", Kirovsky district of the Leningrad region;

·; Site "Kirovsky", Vyborgsky district of the Leningrad region;

·; Site "Lodva", Kirovsky district of the Leningrad region;

·; Site "Pogra", Podporozhsky district of the Leningrad region;

·; Site "Iljmovo 1", Kingisepsky district of the Leningrad region.

Therefore, as soon as the license for exploration, geological survey and sand extraction on these sites is obtained, OJSC Rudas will enlarge its raw materials base to approximately 120 million cubic meters, whereof 63 million cubic meters account for quarried sand reserves and 57 million cubic meters for sea sand reserves.

Georgy Vedernikov, Managing Director of Building Materials, Aggregates and Construction Services of LSR Group, comments:

"New quarries will allow our company not only to increase our raw materials reserves, but also to significantly increase our presence in the region. We are entering the districts of the Leningrad region, which are new to us. In future we will be able to supply sand to huge infrastructure projects (e.g. construction of the Ust-Luga Port and Leningrad NPP in Sosnovy Bor) that earlier was not financially feasible due to the large distance between these sites and sand quarries of LSR Group".

In addition to the mentioned above, some residential and social infrastructure projects will be carried out nearby. For instance, for those who will work in the port or live a short distance away, Ust Luga Company is developing a new residential neighbourhood. The construction will be divided into 2 stages:

- 1st stage of the residential project for 24.5 thousand residents will be completed by 2017;

- 2nd stage of the residential project for 34.5 thousand residents will be completed by 2025.

The total area of the completed project will be 1,849 hectares.

Note to Editors:OJSC LSR Group is a real estate development and building materials company founded in 1993 and operating in a number of complementary market segments. Its core business areas are production of building materials, real estate development and panel construction.LSR Group's main operations are located in St. Petersburg, Moscow, Yekaterinburg and Ukraine.In 2009, the sales revenues of LSR Group were RUB 51,024 million (IFRS).LSR Group is a public company, with its GDRs traded on the London Stock Exchange and its ordinary shares traded on MICEX and RTS.

OJSC Rudas was founded in 1976, since 1997 - it is a subsidiary of LSR Group. Today Rudas is a group of companies extracting, transporting, storing and selling sand, almost fully covering the needs of the construction sector in St. Petersburg and the Leningrad region.

The company supplies sea sand, quarried mining sand and quarried inwash sand as well as ground sand.

Currently OJSC Rudas extracts and processes quarried sand from nine quarries, and sea sand - from four quarries.

For more details please contact:LSR Group Press ServiceTel.: +7 812 314 10 44Fax: +7 812 458 83 72E-mail: press@lsrgroup.ruwww.lsrgroup.ru