The Gazprom Board of Directors approved the Company's activities to arrange pre-development of the Chayandinskoye and Kovyktinskoye fields.

The meeting stressed that Gazprom was engaged in large-scale activities to establish a mature gas industry in Eastern Siberia and the Far East, including gas production, treatment, transmission, and distribution facilities.

Gazprom has already formed new gas production centers in Sakhalin and Kamchatka and started shaping the Yakutia gas production center. The Irkutsk and Krasnoyarsk centers are next in turn.

The Chayandinskoye and Kovyktinskoye fields are the cornerstones for creating the Yakutia and Irkutsk gas production centers respectively. The development of these and other fields in Yakutia and the Irkutsk Region is based on the comprehensive approach. It provides for synchronizing the field development schedules with the construction of the Power of Siberia integrated gas transmission system as well as multicomponent gas treatment in the Amur Region near Belogorsk.

At present, geological exploration activities are being conducted in the Chayandinskoye field. This year it is planned to complete the construction of 14 exploratory wells and carry out almost 1,200 square kilometers of 3D seismic surveys. In 2016, upon completion of the exploration activities, it is planned to submit the final reserve estimation to the State Reserves Commission.

The follow-up draft exploration projects are being prepared for the Sobolokh-Nedzhelinskoye, Verkhnevilyuchanskoye, Tas-Yuryakhskoye and Srednetyungskoye fields of Gazprom in Yakutia. The geological exploration program aimed at potential construction of underground helium concentrate storage facilities within the Chayandinskoye and Tas-Yuryakhskoye fields is nearly complete.

Preparation is underway for constructing exploratory wells in the Kovyktinskoye field in 2014. It is projected to conduct 100 cubic kilometers of 3D seismic surveys in 2013.

In addition, construction and pre-commissioning of the pilot unit for testing between 2013 and 2015 the membrane technology for in-field helium extraction are in progress at the Kovyktinskoye field. Currently, the unit is being tested in different operation modes in compliance with the test schedule. The obtained data will be used for constructing a similar unit in the Chayandinskoye field as well.

Background

The state-run 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) was adopted in September 2007 pursuant to the Russian Industry and Energy Ministry Order. Gazprom was appointed by the Russian Federation Government as the Program execution coordinator.

Gazprom adopted the final investment decision for the pre-development of the Chayandinskoye field, construction of the Power of Siberia gas transmission system and gas processing facilities in Belogorsk in October 2012. It is projected to bring the oil rim into production in 2014 and the gas deposit – in 2017. Having reached a full capacity, the field will annually produce up to 25 billion cubic meters of gas and at least 1.5 million tons of oil.