On 13 February 2007 OAO Gazprom issued its unaudited consolidated interim condensed financial information prepared in accordance with International Accounting Standard 34 “Interim Financial Reporting” (IAS 34) for the nine months ended 30 September 2006.

A significant factor impacting the comparability of the consolidated financial information of Gazprom Group for the nine months ended 30 September 2006 with the same period of 2005 was the acquisition in October 2005 of OAO Sibneft (from June 2006 – OAO Gazprom Neft (Gazprom neft)). Higher oil and gas market prices also significantly impacted results.

The table below presents the unaudited consolidated interim condensed statement of income for the nine months ended 30 September 2006 and 2005. All amounts are presented in millions of Russian Roubles, unless otherwise stated.

	Nine months ended
	30 September
	2006	2005
Sales (net of excise tax, VAT and customs duties)	1,581,328	902,235
Operating expenses	(1,012,913)	(587,338)
Operating profit	568,415	314,897
Finance income	82,320	37,204
Finance expenses	(51,576)	(40,244)
Share of net income of associated undertakings and jointly controlled entities	19,869	10,935
Gain on disposal of available-for-sale financial assets	3,531	1,843
Profit before profit tax	622,559	324,635
Current profit tax expense	(156,684)	(78,183)
Deferred profit tax expense	(5,610)	(12,491)
Profit tax expense	(162,294)	(90,674)
Profit for the period	460,265	233,961
Profit for the period attributable to:
Equity holders of OAO Gazprom	442,296	232,130
Minority interest	17,969	1,831
	460,265	233,961

Sales (net of excise, VAT and customs duties) increased by RR679,093 million, or 75%, to RR1,581,328 million in the nine months ended 30 September 2006 compared to the nine months ended 30 September 2005. More detailed information on our sales for the nine months ended 30 September 2006 and 2005 is presented in the table below.

in million RR (unless otherwise stated)	Nine months ended 30 September
Sale of gas	2006	2005
Europe
Net sales (net of excise tax and customs duties)	604,231	426,509
Volumes in bcm	118.8	115.7
Gross average price, RR/mcm (including excise tax and customs duties)	6,995.4	5,087.4
FSU
Net sales (net of excise tax, VAT and customs duties)	157,283	84,027
Volumes in bcm	75.5	59.0
Gross average price, RR/mcm (including excise tax, customs duties and net of VAT)	2,441.7	1,760.1
Russia
Net sales (net of excise tax and VAT)	246,822	212,774
Volumes in bcm	219.6	210.7
Gross average price, RR/mcm (including excise tax and net of VAT)	1,128.0	1,015.4
Total sales of gas
Net sales (net of excise tax, VAT and customs duties)	1,008,336	723,310
Volumes in bcm	413.9	385.4
Net sales of refined products (net of excise tax, VAT and customs duties)	333,216	104,900
Net sales of crude oil and gas condensate (net of excise tax, VAT and customs duties)	141,049	10,368
Gas transportation sales (net of VAT)	25,141	18,032
Other revenues (net of VAT)	73,586	45,625
Total sales (net of excise tax, VAT and customs duties)	1,581,328	902,235

Net sales of natural gas increased by RR285,026 million, or 39%, to RR1,008,336 million in the nine months ended 30 September 2006 compared to the nine months ended 30 September 2005. This increase was primarily due to higher European and FSU prices for gas as well as higher volumes of gas sold.

Net sales of natural gas to Europe increased by RR177,722 million, or 42%, to RR604,231 million in the nine months ended 30 September 2006 compared to the nine months ended 30 September 2005. This was primarily due to higher average prices for gas to European customers and the 3% increase in the volume of gas sold.

Net sales of natural gas to FSU countries increased by RR73,256 million, or 87%, to RR157,283 million in the nine months ended 30 September 2006 compared to the nine months ended 30 September 2005. The increase of sales in this segment is explained by higher prices and higher sales volumes.

Net sales of natural gas in the domestic market increased by RR34,048 million, or 16%, to RR246,822 million in the nine months ended 30 September 2006 compared to the nine months ended 30 September 2005. This is explained primarily by increased average domestic price for gas established by the Federal Tariff Service, and increased volumes.

In the nine months ended 30 September 2006 sales of refined products increased by RR228,316 million primarily due to the consolidation of Gazprom Neft as well as increased market prices for refined products in the nine months ended 30 September 2006 compared to the nine months ended 30 September 2005.

In the nine months ended 30 September 2006 net sales of crude oil and gas condensate increased by RR130,681 million. The increase of sales in this segment is explained by the consolidation of Gazprom Neft’s results starting from October 2005.

Operating expenses increased by RR425,575 million, or 72%, to RR1,012,913 million in the nine months ended 30 September 2006 compared to the nine months ended 30 September 2005 primarily due to the consolidation of Gazprom Neft’s results since October 2005, when control was established.

The increase in operating expenses included higher expenses on purchased oil and gas (RR139,659 million, including Gazprom Neft - RR59,084 million), higher taxes other than on income (RR74,414 million, including Gazprom Neft - RR64,739 million), higher expenses on transit of gas, oil and refined products (RR48,497 million, including Gazprom Neft – RR42,254 million.), higher depreciation (RR33,589 million, including Gazprom Neft – RR28,647 million), higher expenses on goods for resale, including refinery products (RR31,502 million, including Gazprom Neft – RR27,241 million), higher staff costs (RR27,762 million). The increase in purchased oil and gas was caused by the appearance of a new type of expenses - “purchased oil” - due to consolidation of Gazprom Neft, and increase in cost of purchased oil and gas in Central Asia. The increase in taxes other than on income was primarily due to consolidation of Gazprom Neft and changes in tax legislation related to natural resources production tax effective from 1 January 2006. The increase in expenses on transit of gas, oil and refined products was primarily due to consolidation of Gazprom Neft as well as a general increase in gas volumes sold to Europe and FSU customers and the growth of transit tariffs. The increase in the staff costs resulted from the increase in average base salaries and other payments and the increase in average number of employees.

The profit tax increased by RR71,620 million, or 79%, to RR162,294 million in the nine months ended 30 September 2006 compared to RR90,674 million for the nine months ended 30 September 2005. Our effective current profit tax rate for the nine months ended 30 September 2006 was 26.0% compared to 27.9% for the nine months ended 30 September 2005.

In the nine months ended 30 September 2006 our profit for the period attributable to equity holders of OAO Gazprom totaled RR442,296 million which is RR210,166 million, or 91%, higher compared to the nine months ended 30 September 2005.

Our net debt balance (defined as the sum of short-term borrowings, current portion of long-term borrowings, short-term promissory notes payable, long-term borrowings, long-term promissory notes payable and restructured tax liabilities, net of cash and cash equivalents and balances of cash and cash equivalents restricted as to withdrawal under the terms of certain borrowings and other contractual obligations) decreased by RR30,244 million, or 4%, from RR797,465 million as of 31 December 2005 to RR767,221 million as of 30 September 2006. This decrease can be explained primarily by cash repayments of long-term borrowings.

More detailed information on the IFRS consolidated interim condensed financial information for the nine months ended 30 Setember 2006 can be found here.