ARMENIAN ELECTRICITY NETWORKS COULD BE PURCHASED BY RUSSIAN CONCERN

RIA Novosti
September 12, 2005

EREVAN, September 12 (RIA Novosti, Gamlet Matevosyan) – Midland
Resources Holding Ltd, a British company, has requested permission from
the Armenian government to sell its 100% stake in Armenian Electricity
Networks (AEN) shares, a spokesman for the Public Services Regulatory
Commission of Armenia said Monday.

According to Armenian energy legislation, the company is not entitled
to sell its shares in the AEN without obtaining permission from the
Armenian government and the committee.

Midland Resources, which acquired a 100% of AEN shares at $40 million,
lent shares to the Russian company Interenergo for a 99-year term at
an estimated cost of $73 million, while retaining its ownership of
the stock.

Interenergo is a joint venture, 60% owned by the Russian Inter Unified
Energy System, the asset of the state holding Russian Unified Energy
System, and 40% owned by the Rosenergoatom concern, a state-owned –
and the world’s largest – nuclear power generating company.

Inter UES, the export-import electricity operator, has trade deals
on electricity supply with Armenia, Belarus, Georgia, Kazakhstan,
China, Moldova, Mongolia, Lithuania, Latvia, Norway, Russia, Ukraine
and Finland. It also manages energy facilities in Armenia, Georgia,
Moldova and Russia.