A working meeting between Alexey Miller, Gazprom’s Management Committee Chairman, and Alexander Tkachev, Governor of the Krasnodar region, was held today at Gazprom’s headquarters.

Mr. Miller and Mr. Tkachev discussed the progress in implementing the program on gas supply to the Krasnodar region, in particular, the viability of the projects on building the Dzhugba-Lazarevskoye-Sochi, Lazarevskoye-Tuapse-Nebug and other gas branches.

The parties also considered the issues of Gazprom’s subsidiaries’ taxation in the Krasnodar region and of restructuring the regional suppliers’ indebtedness for gas delivered as well as the issue of full compensation of gas subsidiaries granted to eligible consumer categories, from the regional budget.

Mr. Miller and Mr. Tkachev paid special attention to the operation of gas distribution companies in the Krasnodar region and discussed Gazprom and Russia’s Federal Energy Commission’s strategy on signing direct agreements between gas suppliers and gas consumers.

“The mechanism of settlements for gas deliveries should be more transparent in the Krasnodar region. We’ve discussed the issue with Mr. Miller today. Gazprom is moving in the right direction. It’s impossible to invest in the gas transmission system development without restoring order in the field, where a lot of problems had been accumulated”, - Governor of the Krasnodar region stressed.

Besides, Mr. Miller and Mr. Tkachev noticed the importance of elaborating a new draft agreement on cooperation between Gazprom and the Krasnodar region’s administration.

Reference:

In 2002, Gazprom delivered some 8.2 bcm of natural gas to the Krasnodar region. Over the first 9 months of 2003, the Krasnodar region’s consumers received about 6 bcm of natural gas, inclusive over 0.5 bcm delivered beyond the contractual volumes.

The Krasnodar region consumers’ indebtedness for gas actually delivered accounts today for RR 606.9 mln. The average level of regional consumers’ payments for current gas deliveries in 2003 is 97.53%.

Since 2003, natural gas has been supplied to the Krasnodar region in line with Gazprom’s investment program. Under the program, RR 127.1 mln will be invested to build regional gas infrastructure facilities in 2003. Over the 11 months of this year, 47.1 km of gas distribution pipelines were commissioned in the Krasnodar region. Gazprom’s investment program for 2004 envisages the allocation of over RR 32 mln to build and modernize regional gas distribution facilities.

DIVISION OF RELATIONS WITH MASS MEDIA