OREANDA-NEWS. May 25, 2011. Sumitomo Corporation (Chuo-ku, Tokyo; President and CEO: Susumu Kato; hereinafter, "Sumitomo") hereby announces that Sumitec International Ltd. (hereinafter "Sumitec"), a Sumitomo subsidiary that sells construction and mining machinery and material handling equipment, has opened a branch in Kemerovo Oblast, a regional center of Kuzbass, Russia ("Kuzbass Office"). This is first time a Japanese company has established a sales and service dealer for mining equipment in the region.

Sumitomo has recently been focusing on the sales and service of mining machinery around the world. The opening of the new office in Kemerovo marks its second major step following the winning of a contract in January 2011 to supply mining machinery for a large-scale mining project in Mongolia. In Russia, Sumitec has steadily expanded sales of construction and mining machinery manufactured by Komatsu Ltd. and material handling equipment since its establishment in 2001, working within the vast territory of the Far Eastern, Siberian and Northwestern Federal Districts. The new office will help the company enhance its sales network and provide better service. Sumitomo Corporation dispatched two employees in January 2011 to get the new dealer up and running.

Sumitec took this action in line with a recent move by Komatsu to open a technical support center in Kemerovo Oblast in May 2011 to enable it to offer enhanced technical support for large mining machinery in the region. The two companies intend to combine their respective strengths -- the quality products and technical support of Komatsu and solid sales and service network of Sumitec -- to increase sales to the rapidly growing coal mining companies operating in Russia's largest coal region.

Russia is the world's seventh largest coal producer, with an annual output of 300 million tons, 60% of which is mined in Kuzbass. Coal supplied from the area has a reputation for its good quality and accounts for around 80% of the 100 million tons of coking coal exported by Russia every year.

The synergy of the new collaboration has already proved effective, with Sumitec receiving large orders from Stroyservice, a leading Russian coal mining company, for dump trucks, hydraulic excavators, bulldozers and other mining machinery manufactured by Komatsu. Sumitec expects to earn a total of 5.5 billion yen this fiscal year in sales of large machinery and parts as well as related services to customers in Kuzbass, including Stroyservice. Sumitec aims to achieve more than 10 billion yen in annual sales in the region in 2014.

Sumitomo imports approximately 4 million tons of coal annually from Russia and is ranked among the top Japanese companies in terms of trading volume. Utilizing the integrated corporate strength of our group, we will expand our mining-related business in the emerging markets for a variety of metals and minerals.