Gazprom's group of experts led by Alexander Ananenkov, Deputy Chairman of the Company's Management Committee has finished its business trip to the Far East.

Today the Company's employees visited Gazprom's gas transmission facilities under construction in Vladivostok. A meeting dedicated to gas supply and gasification of the Far East and first of all – the Primorsky Krai took place.

It was highlighted at the meeting that construction of the Sakhalin – Khabarovsk – Vladivostok gas transmission system (GTS), a key element of the Unified Gas Supply System in Eastern Russia was nearing completion. At the moment, trenching and burying of the linepipe within the GTS first startup complex is close to completion.

The linepipe of the gas trunkline with the length exceeding 1,100 kilometers has passed the robustness test. Natural gas is being fed to the gas pipeline sections stretching for more than 800 kilometers (process operation preceding the GTS commissioning).

Startup operations have been successfully performed at the gas distribution station (GDS) in Vladivostok. The inter-settlement gas pipeline connecting the GDS to the Russky Island with a lateral to CHPP-2 in Vladivostok is ready for gas supplies: the gas pipeline is constructed including the first string of the submerged crossing under the Eastern Bosphorus Strait. Construction of the gas pipeline from a gas distribution station to CHPP-1 with a lateral to the Severnaya boiler house is underway.

Based on the meeting results, the tasks were given to ensure timely delivery of Gazprom's investment projects in the Far East.

Background

Gazprom's expert groups take regular trips to the Far East. A group is made up of top managers from the Company, its specialized subdivisions, subsidiaries and contracting agencies. The trips are primarily aimed at monitoring the execution of the projects on shaping the Unified Gas Supply System in Eastern Russia on the basis of the Company's resource base.

The September 2007 Order by the Russian Federation Industry and Energy Ministry approved 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). Gazprom was appointed by the Russian Federation Government as the Program execution coordinator.

The Eastern Gas Program gives priority to the creation and development of the Sakhalin – Khabarovsk – Vladivostok gas transmission system (GTS). Launched in July 2009, the GTS construction is targeted at developing gas supplies to the Khabarovsk Krai and the Sakhalin Oblast as well as arranging gas deliveries to the Primorsky Krai. The 1,350-kilometer first startup complex of the gas pipeline with the annual capacity of 6 billion cubic meters is to be brought onstream in the third quarter of 2011.

The total design length of the gas pipeline from the GDS in Vladivostok to the Russky Island with a lateral to CHPP-2 in Vladivostok is some 34 kilometers: more than 15 kilometers on the mainland, some 12 kilometers on the Russky Island and more than 6 kilometers (two strings: main and backup) under the Eastern Bosphorus Strait.

Gas from the Sakhalin – Khabarovsk – Vladivostok GTS will be delivered to CHPP-2 and utilized for heat and power supply to the 2012 APEC Summit venues. Conversion of CHPP-2 from coal to gas will ensure more reliable power supply to consumers in Vladivostok significantly improving the environmental situation in the city.