Today at the Gazprom Headquarters Alexey Miller, Chairman of the Gazprom Management Committee and Valery Serdukov, Governor of the Leningrad Oblast signed an Agreement of Cooperation between Gazprom and the Leningrad Oblast Government for 2009.

Pursuant to the Agreement the parties will continue comprehensive development of the Leningrad Oblast gas supply system with due regard of the Nord Stream gas trunkline project.

Gazprom and the Leningrad Oblast Government will cooperate in securing efficient gas utilization in the household sector by the systematic reconstruction and upgrading of thermal energy equipment. The parties will also unite their efforts in creating comprehensive energy supply systems for industrial consumers based on the utilization of up-to-date gas saving technologies and equipment.

The Government of the Leningrad Oblast will ensure a full payment of the current gas supplies to budget consumers, consumers’ readiness to receive gas in line with the synchronized gasification facilities construction schedule for 2009-2010 signed including gas metering equipment installation. The Government will establish economically sound gas consumption rates for consumers who do not have gas metering equipment.

The Government will develop and approve the schedule of switching to backup fuel supply for the Leningrad Oblast organizations during cold snaps and its implementation order.

Within the scope of its competence the Oblast Government will adopt a number of regional legislative acts targeted at regulating and promoting utilization of natural gas as motor fuel. Gazprom and its subsidiaries will be assisted in right-of-way related issues resolving.

In 2009 Gazprom, in its turn, will provide uninterrupted gas supply to the Leningrad Oblast consumers. The Company will earmark in a draft Gasification Program for the Russian Federation Regions for 2009 the financial resources for the construction end-up of formerly launched and start-up of new gasification facilities construction in the Leningrad Oblast with due regard of the regional Government proposals. Gazprom will also allocate funds to perform design & exploration works and project review for constructing gas laterals to a number of population centers including the towns of Primorsk and Priozersk.

Additionally, in 2009 Gazprom will provide funds for implementing thermal energy investment projects in the Leningrad Oblast.

Gazprom will participate in investment projects and programs in the region provided investments pay off and rates of return meet the intra-corporate standards.

Background:

The five-year Agreement of Cooperation between Gazprom and the Leningrad Oblast Government was signed on April 25, 2003 with the Supplement extending its duration with no time limitation signed in February 2008.

In 2009 Gazprom plans to supply some 4.6 billion cubic meters of gas to the Leningrad Oblast consumers, the same volume as supplied last year.

The regional consumers have no gas debt the indebtedness for supplied gas and make advance payments.

The average gasification level of the Leningrad Oblast is at 54.9 per cent including 67.1 per cent in cities and towns and 31.2 per cent in rural area. The identical figures throughout Russia account for 62 per cent, 67 per cent and 44 per cent respectively.

During 2002-2007 Gazprom committed over RUB 1.57 billion for the gasification of the Leningrad Oblast. In 2008 Gazprom invested RUB 300 million in the region’s gasification, with some RUB 280 million slated for the current year.

The Nord Stream gas pipeline is a fundamentally new route for Russian gas exports to Europe. The gas pipeline will run across the Baltic Sea from the Portovaya Bay (in the vicinity of Vyborg) to the German coast (in the vicinity of Greifswald). The gas pipeline length will be some 1,200 km.

In order to connect the Nord Stream to the Unified Gas Supply System, the new gas pipeline Gryazovets – Vyborg (917 km) is being constructed. The gas pipeline will run across the Vologda and Leningrad Oblasts.