Under the agreement, LUKOIL will sell natural gas produced at the Nakhodkinskoye gas and condensate field of the Bolshekhetskaya depression (Yamal-Nenets autonomous area) to Gazprom. In its turn, Gazprom undertakes to pay gas production cost and `expenditures for gas transportation through the United Gas Transmission System (UGTS) of Russia.

First gas from the Nakhodskinskoye field will be delivered to the Yamburgskaya compressor station (CS), an integrant of the UGTS, in the IV quarter of 2005. By 2006, the total volume of the “blue fuel” supply from the field will reach approximately 8 bcm.

By that time LUKOIL is expected to complete construction of the inter-field gas pipeline from the Nakhodskinskoye field to the Yamburgskaya CS.

The document also contains the price formula according to which Gazprom will execute payments for gas.

The Agreement wass signed as a supplement to the General agreement between Gazprom and LUKOIL on strategic partnership for 2002–2005. The General agreement stipulates, in particular, joint implementation of projects for exploration and development of oil and gas fields in the Yamal-Nenets autonomous area (YNAA), Nenets autonomous area (NAA) and the Russian sector of the Caspian Sea. The Agreement also calls for deepening the cooperation in sea transportation of oil and gas condensate produced from YNAA and NAA’s northern regions.

At the Agreement signing ceremony the parties expressed their common opinion: the existing model of interrelations should become a basis for Gazprom’s cooperation with independent gas producers.

“The Agreement signed today is indicative of expanding the cooperation between Gazprom and LUKOIL. Our partnership is an example of successful joint operation under conditions of Russian gas market formation, when Gazprom and independent gas producers solve problems jointly, on the mutual responsibility basis” – declared Alexey Miller.

“The present event is a successive step on the way to realization of particular joint projects. Since the company is determined to become one of the biggest gas producers, LUKOIL intends to deepen its cooperation with Gazprom,” said Vagit Alekperov, President of LUKOIL.

PRESS SERVICE OF GAZPROM

PRESS SERVICE OF LUKOIL