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 parties addressed the outlook for deeper cooperation in the oil and gas sector and pointed inter alia to the considerable progress in the implementation of the Strategic Partnership Agreement.

The parties agreed to enter until the end of this October into an asset management agreement for Arcticgaz acquired by ENI in 2007.

The document will set out a development plan for Arcticgaz as well as the company’s gas marketing & transportation terms and conditions.

The agreement will also contemplate Gazprom’s entry into hydrocarbon exploration and production projects in Libya.

Furthermore, the parties highlighted the progress in the execution of the South Stream projects and discussed a plan of further actions.

Background:

The natural gas market of Italy is the third-largest in Europe after the UK and Germany. The share of gas in the Italian energy mix exceeds 30 per cent. The major importers of gas to the country are Algeria and Russia.

Italy is the second-largest importer of Russian natural gas in Europe. In 2007 Gazprom export supplied the country with around 21.96 bcm 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 bcm 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 MoU 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.