Moscow, Russia - December 8, 2004 - Mechel Steel Group (NYSE: MTL) issued the following statement today regarding the requests for information that it has received from the Ministry of Internal Affairs:

As we have stated, Mechel has received requests this week from the Ministry of Internal Affairs regarding documentation about the normal course of business of Mechel and our subsidiary, Mechel Trading House.  We are fully cooperating with the Ministry.  However, recent press reports have inaccurately indicated that the investigation is related to tax issues.  No claims, including tax claims, have been made against us.  We believe that the investigation has been instigated in an attempt to prevent us from participating in the auction for the government’s stake in MMK and is in no way related to our business operations.  We intend to vigorously defend our effort to participate in the auction.

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Mechel Steel Group OAO
Irina Ostryakova
Director of Communications
Phone: 7-095-258-18-28
Fax: 7-095-258-18-38
E-mail:irina.ostryakova@mechel.com

Financial Dynamics
Investor Relations: Eric Boyriven/Jim Olecki
Press: Scot Hoffman
Phone:+1 212 850-5600

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

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Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of Mechel Steel Group, as defined in the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. We wish to caution you that these statements are only predictions and that actual events or results may differ materially. We do not intend to update these statements. We refer you to the documents Mechel Steel Group files from time to time with the U.S. Securities and Exchange Commission, including our Form F-1. These documents contain and identify important factors, including those contained in the section captioned “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in our Form F-1, that could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, the achievement of anticipated levels of profitability, growth, cost and synergy of our recent acquisitions, the impact of competitive pricing, the ability to obtain necessary regulatory approvals and licenses, the impact of developments in the Russian economic, political and legal environment, volatility in stock markets or in the price of our shares or ADRs, financial risk management and the impact of general business and global economic conditions.