Headed by Alexey Miller, Chairman of the Gazprom Management Committee, a Gazprom delegation today paid a working visit to Vilnius. As part of the visit Alexey Miller met with Andrius Kubilius, Prime Minister of the Republic of Lithuania.

The parties discussed the progress with constructing the second string of the Minsk – Vilnius – Kaunas – Kaliningrad gas pipeline. The final joint of the pipeline has been welded today in the Sakiai District. Cooperation between Gazprom and Lietuvos Dujos within the project was highly appreciated. It was noted that the constructed gas pipeline would ensure reliable gas supply to the Russian enclave and create preconditions for a potential increase in gas supplies to Lithuania.

Alexey Miller and Andrius Kubilius addressed the issues of further cooperation development between Gazprom and Lithuania in the field of enhancing security of Russian gas transit, its marketing and construction of new gas transmission facilities in the Republic.

Summing up the negotiations, the parties expressed hope that bilateral relations would further be strengthened.

Background:

In compliance with the Russian Federation Government orders, Gazprom has developed and is implementing the Action Plan aimed at supplying the Kaliningrad Oblast with 2.5 billion cubic meters of natural gas by 2010. The Plan stipulates:

- constructing the second string of the Minsk – Vilnius – Kaunas – Kaliningrad gas pipeline within a single technological corridor with the first string with 1.4 billion cubic meters in throughput capacity that has been operated since 1985. The second string stretches 139.2 kilometers.

- building the Kaliningrad UGS facility in order to mitigate daily and seasonal fluctuations in gas consumption as well as to stockpile gas to be used in case of anomalously cold winter spells or emergencies. The first start-up complex of the UGS facility will be brought onstream in late 2009.

- increasing the Krasnoznamenskaya CS capacity to guarantee the projected gas supplies via the Minsk – Vilnius – Kaunas – Kaliningrad gas pipeline.

In addition, Lietuvos Dujos has constructed in the Republic of Lithuania a 700-millimeter looping that stretches 18 kilometers from the Sakiai gas metering station to the Russian Federation border. The looping is designed for raising gas transit to the Kaliningrad Oblast. The following projects are currently underway:

- increasing the Sakiai gas metering station performance up to 480 thousand cubic meters per hour by December 2009;

- constructing a new compressor station near Vilnius (Yaunyunay CS) in 2010.

Natural gas is exported to the Republic of Lithuania under long-term agreements effective through 2015.

In 2008 Lithuania was supplied with around 3.1 billion cubic meters of natural gas.

Lietuvos Dujos deals with gas purchase, transmission and distribution in the Republic of Lithuania, as well as with Russian gas transit to the Kaliningrad Oblast. Gazprom holds a 37 per cent stake in the company.