Gazprom’s Management Committee (MC) examined and approved today the indices of the Company’s Plan for Social and Economic Development and made amendments to the Budget, Investment Program and Cost Reduction Program for 2004.

Under the Draft Plan for Social and Economic Development, in 2004 Gazprom’s gas and gas condensate and oil production is estimated at 542 bcm and 11.38 million tons, respectively.

Gazprom will keep on developing its hydrocarbon base. In 2004, additions to the hydrocarbon reserves are expected to reach 450 million tons of fuel equivalent.

In the reviewed budget, Gazprom’s total incomes and expenditures for 2004 are estimated at RR 1,192 billion and RR 1,399 billion, respectively.

The Company’s financial borrowings in 2004 are estimated at RR 150 billion.

The total budget deficit could reach RR 17.5 billion.

Gazprom’s MC made amendmends to the Company’s Investment Program for 2004 within the limits of RR 232.34 billion previously approved as a basis. Gazprom’s capital investments will amount to RR 207.3 billion and long-term financial investments – RR 25 billion.

The MC ordered to submit the verified Budget, Investment Program and Cost Reduction Program for 2004 for Gazprom’s Board of Directors’ approval.

The MC also ordered Gazprom’s relevant departments and subsidiaries to reach preset financial results through wide implementation of cost-cutting initiatives. At the same time, the MC adopted a resolution to reduce construction and procurement expenses by rejecting mediators’ services and holding tenders. The MC also ordered to reduce auxiliary gas, heat and power consumption. To enhance gas supply schemes and cut costs, Gazprom’s relevant departments must prepare the proposals on altering The Order of Arranging Procurement Financing within the 1st quarter of 2004.

Under the RF Government’s instructions, in April 2004 Gazprom will elaborate and submit for the Government’s approval the corporate Draft Investment Program and Draft Financial Plan up to 2006.

DIVISION OF RELATIONS WITH MASS MEDIA