Norilsk Nickel announces the result of NordStar’s operations for three years

MMC Norilsk Nickel informs about implementation progress of own airline project. Three years ago, on June 17 2009, Taimyr Airlines (NordStar trademark) carried out its first flight from Moscow to Norilsk, starting regular flights on two of the most important routes for Norilsk: Norilsk-Moscow and Norilsk-Krasnoyarsk. At the same time, the airlines stated performing the flights between Krasnoyarsk and Moscow.

Creation of the corporate airline was motivated by Norilsk Nickel’s desire to ensure social stability in the primary region of its operations by guaranteeing Norilsk residents the opportunity to access consistent and affordable means of air transportation, considering the harsh climate conditions and geographic remoteness.

During the three years of its operations, NordStar has considerably expanded the aircraft fleet and geographical span of its routes. Currently NordStar has nine Boeing 737-800NG and five turboprop ATR 42-500 aircrafts, specially modified to operate in the harsh weather conditions of Siberia and extreme North.

During the same period, the number of flight routes from Norilsk has increased to 15. NordStar flies to Moscow, Krasnoyarsk, St. Petersburg, Abakan, Anapa, Belgorod, Yekaterinburg, Krasnodar, Mineralnye Vody, Nizhny Novgorod, Novosibirsk, Rostov-on-Don, Samara, Sochi and Ufa.

Having an own airline enables the Company to control the expenditures associated with provision of social package to its employees more efficiently. We remind that, starting from January 1, 2012, Norilsk Nickel introduced annual transportation and luggage transfer cost reimbursement system for its employees and their family members travelling to holiday destinations and back (in accordance with the effective Collective Agreement, the Company pays for the transfer once every two years). Given the geographic remoteness and harsh conditions of the extreme North, where the employees of MMC Norilsk Nickel work, such measure constitutes an important part of the social package provided by the Company to its employees. Over 100 thousand employees and their family members are able to receive the compensation annually. Corresponding MMC Norilsk Nickel’s expenses amount to over RUB 2.5 bln. per annum.

Carrying out of domestic flights from Krasnoyarsk is considered to be an important direction for the development of the airline, in accordance with the air transportation development agreement signed between MMC Norilsk Nickel and the Government of Krasnoyarsk Region in March 2010. Starting from May 2011, NordStar operates the flights from Krasnoyarsk to the following regional destination: Baikit, Vanavara, Igarka, Podkamennaya Tunguska, Severo-Yeniseisk, Tura and Turukhansk. In 2011, NordSrat started operating flights from Krasnoyarsk to the following destinations in Russia: Abakan, Anapa, Barnaul, Vladivostok, Yekaterinburg, Irkutsk, Krasnodar, Mineralnye Vody, Nizhnevartovsk, Novosibirsk, Rostov-on-Don, Samara, St. Petersburg, Sochi, Surgut, Tomsk, Ulan-Ude, Khabarovsk, Chita as well as to Baku, Dushanbe and Khudzhand.

Addition of new flight routes, high safety and comfort levels as well as affordable prices enabled NordStar to become the major airline company in Krasnoyarsk Region. The results of airline’s operations confirm the existence of demand for the transportation services rendered by MMC Norilsk Nickel as part of its airline projects to residents of the region. Over the course of last year (starting from June 17, 2011), NordStar successfully carried out over 11 thousand flights, transported over 900,000 passengers and 4.5 million tons of cargo.

ABOUT MMC NORILSK NICKEL

MMC Norilsk Nickel, a company incorporated under the laws of the Russian Federation, is the largest diversified mining and metals company in Russia, the world's largest producer of nickel and palladium and one of the world's largest producers of platinum, rhodium, copper and cobalt. In addition to this, MMC Norilsk Nickel produces a large number of other by-products, including gold, silver, tellurium, selenium, iridium and ruthenium.

The key production units of the Company’s group in Russia are at the Polar and Kola Peninsulas. MMC Norilsk Nickel international assets include operations in Finland, Australia, Botswana and South Africa.

MMC Norilsk Nickel’s shares are traded at MICEX-RTS. ADR’s on the Company’s shares are traded on the other the counter market in the US and at the London and Berlin stock exchanges.
18.06.2012