The Company’s Management Committee approved the Gazprom Procurement Streamlining Policy and made a decision to compile information on procurement streamlining to be considered by the Board of Directors.

The Management Committee also endorsed a draft Procedure for the awards of contracts for the supply of goods, completion of works and rendering of services for Gazprom and its subsidiaries to a sole supplier (executor, contractor) and made a decision to submit the Procedure to the Board of Directors for consideration.

The Management Committee tasked the Company’s core business units to develop the documents regulating the decision making on contract awards to a sole supplier (executor, contractor).

Reference:

In July 2004, in order to improve the procurement system, the Company’s Board of Directors endorsed the Provision on preferentially contest-based awards of contracts for the supply of goods, completion of works and rendering of services for Gazprom and its subsidiaries.

Pursuant to the Provision, tender procedures are organized by the Contest Commission and Tender Committee of Gazprom or contest commissions and tender divisions at the subsidiary level.

Information on tenders is published at the official website of the Russian Federation (www.zakupki.gov.ru), in the ‘Tenders’section of the Company’s corporate website and in print media.

Streamlining of the existing procurement system of Gazprom provides for:

• Streamlining the regulatory framework for procurement.
• Improving the contests quality and enhancing their effectiveness.
• Streamlining the practice of pricing for the subject of tender (benchmark/base/limit/estimated prices for the subject of tender).
• Establishing a unified automated system of electronic procurement (trade) in Gazprom.
• Attracting potential suppliers (executors, contractors) to participate in contest-based procurement.

A draft Procedure for the awards of contracts for the supply of goods, completion of works and rendering of services for Gazprom and its subsidiaries to a sole supplier (executor, contractor) identifies cases when such contracts are awarded to a sole supplier (executor, contractor).