Today at the Gazprom Headquarters Alexander Ananenkov, Deputy Chairman of the Company’s Management Committee held a meeting on the gasification and gas supply to Eastern Siberia and the Far East.

The meeting brought together the Management Committee Members: Oleg Aksyutin, Head of the Gas Transportation, Underground Storage and Utilization Department, Yaroslav Golko, Head of the Investment and Construction Department as well as heads and experts from the specialized subdivisions of Gazprom Administration and the subsidiaries operating in eastern Russia.

The meeting participants reviewed the progress with the major gasification projects being implemented by Gazprom in Eastern Siberia and the Far East. Special emphasis was put on the construction of the Sakhalin – Khabarovsk – Vladivostok gas trunkline, promotion of gas supply to the Kamchatka Krai and the gasification of the Irkutsk Oblast.

In was noted that Gazprom timely implemented the commitments fixed in the Cooperation Agreements and Gasification Accords with the Russian Federation constituents in Eastern Siberia and the Far East. At the same time, the meeting pointed out the relevance of a comprehensive approach to the gasification of eastern regions, which envisages the utilization of both pipeline and liquefied gas.

The meeting participants also discussed the expediency for Gazprom to participate in shaping the utility energy sector in the eastern part of Russia.

Based on the meeting results the specialized subdivisions of Gazprom Administration and subsidiaries were engaged with the appropriate tasks.

Background:

The major document defining the strategy of shaping gasification and gas supply to Eastern Siberia and the Far East is the Development Program for an integrated gas production, transportation and supply system in Eastern Siberia and the Far East, taking into account potential gas exports to China and other Asia-Pacific countries (Eastern Gas Program).

At present, Gazprom holds 45 license areas in the Krasnoyarsk Krai, Irkutsk Oblast, Republic of Sakha (Yakutia), Chukotka Autonomous Okrug, in the Okhotsk and Bering Seas offshore areas. This year, the Company is going to acquire the subsurface use rights for the Zapadno-Kamchatsky Block and Block 3 in the Sakhalin III project. Gazprom is performing geological exploration in the Krasnoyarsk and Kamchatka Krais, Irkutsk Oblast and the Sakhalin Island offshore.

The Eastern Gas Program prioritizes, inter alia, constructing and developing the Sakhalin – Khabarovsk – Vladivostok gas pipeline system to be subsequently connected with the Yakutia – Khabarovsk – Vladivostok.

In September 2007 the Russian Federation Government adopted the decision prescribing Gazprom to get involved in the Gas Supply to the Kamchatka Oblast, Phase 1. Gas Supply to Petropavlovsk-Kamchatsky project and gave specific instructions on the relevant issues within the project.

The project envisages developing a number of small gas condensate fields on the western coast of the Kamchatka Peninsula (Kamchatgazprom holds the relevant development licenses), and constructing the Sobolevo – Petropavlovsk-Kamchatsky gas trunkline, as well as distribution networks in Petropavlovsk-Kamchatsky.

Signing of Cooperation Agreements and Gasification Accords between Gazprom and regional authorities is a crucial stage in planning Gazprom’s participation in the gasification of Russian regions.

The Agreements and Accords contain mutual obligations of the Company and regional authorities relevant to the tax, property, social and other areas as well as obligations for arranging regional gas supply and gasification and optimization of regional fuel and energy balances.

By now, Gazprom has inked Cooperation Agreements with Eastern Siberian and Far Eastern regions out of the fourteen and nine regions have inked Gasification Accords with the Company.

In 2005 Gazprom developed the General Scheme of Gas Supply to and Gasification of the Irkutsk Oblast, in the first half of 2009 it will be fully amended. In 2007 the General Scheme of Gas Supply to and Gasification of the Far Eastern Federal District was developed, in 2009 Gazprom plans to finally develop the General Schemes for eleven Eastern Siberian and Far Eastern regions.

The General Schemes stipulate a comprehensive approach to the gasification of the Eastern Siberian and Far Eastern regions. The Schemes also provide for a wide usage of liquefied hydrocarbon and natural gases in parallel with pipeline natural gas.