Gazprom’s Headquarters hosted today a working meeting between Alexey Miller, Chairman of the Company’s Management Committee and Paolo Scaroni, Chief Executive Officer of ENI.

Alexey Miller notified Paolo Scaroni about the current critical situation in the relations with Ukraine and the steps taken by Gazprom for surmounting the crisis.

The parties pointed out that under these conditions high priority should be given to the diversification of the gas export routes, particularly to the implementation of the South Stream project, which would enable to directly link Russia and Europe and to reinforce the energy security of the continent.

Gazprom and ENI agreed to intensify the activities of the Joint Working Group in charge of the preparations for the South Stream project execution. The next meeting of the Working Group will be held tomorrow.

Background:

Italy is the second largest importer of Russian gas to Europe. In 2007 Gazprom export supplied Italy with some 21.96 billion cubic meters of gas.

In November 2006 Gazprom and ENI entered into the Agreement on Strategic Partnership, pursuant to which Gazprom receives the opportunity to effectuate direct Russian gas deliveries to the Italian market starting from 2007. Gas supply volumes will be increased on a stage-by-stage basis to 3 billion cubic meters per annum by 2010. Under the Agreement the existing contracts for Russian gas supplies to Italy have been extended till 2035.

On June 23, 2007 Gazprom and ENI inked the Memorandum of Understanding for the implementation of the South Stream project. The MoU defines the areas of cooperation between the two companies in designing, financing, constructing and managing the South Stream.

On January 18, 2008 South Stream AG, a special purpose company, was registered in Switzerland. South Stream AG was incorporated by Gazprom and ENI on a parity basis.