Moscow, RUSSIA – June 25, 2004 – Mechel Steel Group reports that it has elected two independent Directors to its new Board at its Annual General Shareholders' Meeting.

The following Directors were elected into the new Board at the Meeting: Igor Zyuzin, Vladimir Iorich, Alexey Ivanushkin, Valentin Proskurnya, and two independent directors – Serafim Kolpakov and Alexander Yevtushenko. Provisions on independent directors were included into the Company's Charter and Provisions on the Company's Annual General Shareholders' Meeting and Board of Directors.

"Mechel Steel Group strives to follow best international practice in corporate governance. The Company is committed to increasing its transparency and openness through the institution of independent directors, acknowledged worldwide. We have also incorporated the provisions on independent directors into the Group's constituent documents: the Charter and the Provisions on the Company's Annual General Shareholders' Meeting and Board of Directors. We are proud that such respected and prominent figures as Serafim Kolpakov and Alexander Yevtushenko were elected to our Board. They have shown themselves as brilliant experts in metallurgy and mining", said Vladimir Iorich, CEO of Mechel Steel Group.

"Mechel Steel Group is one of the most dynamically developing metallurgical companies in Russia. I am glad that my extensive experience in metallurgy is needed by this ambitious team of professionals, and that it will be used in achieving the Company's strategic objectives", said Serafim Kolpakov.

"I am certain that the independent directors' work will enable Mechel's Board to shape an objective opinion on all issues. And this will contribute to strengthening confidence in the Company", said Alexander Yevtushenko.

Shareholders have also decided to pay out dividends on ordinary non-documentary shares for 2003 in the amount of RUR 0.39 per one share. Payment is expected to be executed before December 31 2004.

Shareholders have also approved Financial and Accounting Consultants OOO, Moscow, as the independent auditor for Mechel Steel Group.

Shareholders have approved the Company's annual report and annual accounts including profit and loss statement. The Meeting has also elected an Internal Audit Committee of 3 people.

Mr. Igor Zyuzin was elected Chairman at the first meeting of the Board that took place following the Annual Shareholders' Meeting.

Biographic Data of the Independent Directors

Serafim V. KOLPAKOV

From 1992 and currently – President of the International Metallurgists Union (IMU).
1991-1992 – Vice President of the Prospective Materials Association.
1985-1991 – Minister of Metallurgy of the USSR.
1978-1985 – First Deputy Minister, Deputy Minister of Ferrous Metallurgy of the USSR.
1970-1978 – Director of Novolipetsk Metallurgical Plant (NLMK).
1963-1970 –Various executive positions at Novolipetsk Metallurgical Plant (NLMK).
Experience: over 50 years in metallurgy industry.
Education: Academy of National Economy; Moscow Steel and Alloys Institute; Lipetsk Mining and Metallurgy Technical School.
Author of more than 400 inventor's certificates and 500 scientific works.
Born in 1933.

Alexander E. YEVTUSHENKO

2001 - June 2004 – First Vice President of the Sokolovskaya Company, a holding company for a number of coal mining and mining equipment producing companies.
1999-2000 – President of the General Committee of the Inter-State Euro-Asian Coal and Metal Association.
1992-1999 – First Deputy Minister of Fuel and Energy of the Russian Federation.
1991-1992 – Deputy Minister of Fuel and Energy of the Russian Federation.
1986-1991 – Director of Raspadskaya coal mine.
1973 - 1991 – Various positions at Raspadskaya coal mine.
Experience: 31 years in mining industry.
Education: Siberian Metallurgical Institute.
Author of more than 50 scientific works and inventions.
Born in 1947.

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Irina Ostryakova,
Director of External Communications
Phone: 7-095-258 1828
Fax: 7-095-258-1838
irina.ostryakova@mechel.com

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Mechel is a Russian metals and mining company, uniting producers of steel, rolled products, hardware, coal, iron ore concentrate, and nickel. Mechel products are marketed domestically and internationally.