The Gazprom Headquarters today hosted a working meeting between Alexey Miller, Chairman of the Company’s Management Committee and Paolo Scaroni, Chief Executive Officer of ENI.

The meeting addressed the interaction between Gazprom and ENI under the Strategic Partnership Agreement.

The parties discussed the issues of gas supply to Europe in the environment of reduced gas consumption by foreign customers.

The meeting participants positively assessed bilateral cooperation within the pre-investment phase of the South Stream project execution. Upon completion, Gazprom and ENI will make a final investment decision. Furthermore, the parties discussed the possibility of engaging a third party as a partner in constructing the offshore section of the gas pipeline.

In addition, the meeting considered the prospects for launching hydrocarbon feedstock production at the fields owned by SeverEnergia in 2011.

Background:

Italy is the third-largest importer of Russian natural gas in Europe. In 2008 Gazprom supplied the country with 22.4 billion cubic meters of gas.

In November 2006 Gazprom and ENI signed the Strategic Partnership Agreement providing Gazprom with the opportunity to directly supply Russian gas to the Italian market starting from 2007. Annual gas volumes will be gradually increased to 3 billion cubic meters by 2010. Under the Agreement, the existing contracts for Russian gas supply to Italy are extended till 2035.

On June 23, 2007 Gazprom and ENI signed the Memorandum of Understanding for the South Stream project execution. The Memorandum sets the directions of cooperation between the two companies in the South Stream engineering, financing, construction and management sectors.

On January 18, 2008 a special purpose company, South Stream AG, was registered in Switzerland. The company was established by Gazprom and ENI on a parity basis.

On April 7, 2009 Gazprom and ENI signed a Purchase and Sale Agreement for a 20 per cent stake in Gazprom neft.

As agreed upon, the Gazprom’s share in Gazprom neftreached 95.68 per cent. The transaction amounted to some USD 4.1 billion.

SeverEnergia (originally – EniNeftegaz) purchased the following assets in 2007: Arcticgaz (100 per cent), Urengoil (100 per cent), Neftegaztekhnologia (100 per cent), and Gazprom neft (20 per cent).

SeverEnergia Group holds licenses for hydrocarbons exploration and production in Western Siberia.

On September 23, 2009 Gazprom closed a deal for acquiring a 51 per cent stake in SeverEnergia from ENI and Enel.