The Gazprom Headquarters hosted today a regular meeting of the Joint Working Group for Cooperation between Gazprom and the Government of the Republic of Sakha (Yakutia). The meeting was moderated by the Working Group’s heads – Gennady Alexeev, First Deputy Chairman of the Government of the Sakha Republic (Yakutia) and Viktor Timoshilov, Head of the Eastern Projects Coordination Directorate of Gazprom.

The meeting addressed the results of the mutual activities with regard to implementing the Action Plan of the Joint Working Group over 2007-2008.

The parties pointed out that a considerable progress had been achieved over the reported period in the cooperation guidelines provided for in the Cooperation Agreement between Gazprom and Sakha (Yakutia).

Special attention was paid to the joint operations while implementing the comprehensive project for the Chayanda oil, gas and condensate field (OGCF) development, creating gas processing capacities for the field, as well as constructing the Yakutia – Khabarovsk – Vladivostok gas transmission system.

The parties also noted that the General Scheme for gas supply to and gasification of the Republic of Sakha (Yakutia), being developed under the regional Gasification Accord, was at the final stage.

Based on the meeting results agreements were reached on issues of the Joint Working Group activities for 2009-2010.

Background:

The Working Group was set up in pursuance of the Agreement of Cooperation between Gazprom and the Republic of Sakha (Yakutia) signed in July 2007.

The Agreement stipulates the following major directions for the joint work as part of the Eastern Gas Program implementation:

- joint participation in the development and execution of gas supply & gasification projects and programs in the Sakha Republic (Yakutia);

- preparation and implementation of hydrocarbon field prospecting, exploration and development projects;

- organization of the regional processing and chemical production;

- gas and energy saving technologies development and implementation.

In July 2007 Gazprom and the Republic of Sakha (Yakutia) entered into the Agreement of Cooperation.

The Development Program for an integrated gas production, transportation and supply system in Eastern Siberia and the Far East, taking into account potential gas exports to China and other Asia-Pacific countries (Eastern Gas Program) was approved at the meeting of the Russian Federation Government on June 19, 2007 and adopted by the September 3, 2007 Order of the Russian Federation Industry and Energy Ministry. The Program particularly stipulates establishing the Yakutsk gas production center on the basis of the Chayanda OGCF.

Pursuant to the Directive of the Russian Federation Government Gazprom was appointed as the Eastern Gas Program execution coordinator.

In accordance with the Russian Federation Government Directive of April 16, 2008 Gazprom, as the owner of the Unified Gas Supply System, was entitled to the license for the Chayanda OGCF on a sole source basis.

The Chayanda oil, gas and condensate field is situated in the Lensk region of the Republic of Sakha (Yakutia). The field’s C1+C2 reserves make up 1.24 tcm of gas and 68.4 mln t of oil and condensate.

The Government of the Republic of Sakha (Yakutia) developed and approved by the federal authorities the Comprehensive Development Scheme for the production, transportation and power generation sectors until 2020 and the Comprehensive Development project of the Southern Yakutia, which involves potential development of the Republican gas production and processing center.