The Gazprom Headquarters hosted today a working meeting between Alexey Miller, Chairman of the Company’s Management Committee and Vladimir Semashko, First Deputy Prime Minister of the Republic of Belarus.

The parties discussed the 2009 operating results relevant to Russian gas supplies to Belarus and its transit via the Republic to European consumers, as well as considered the prospects for the cooperation deepening.

Alexey Miller said that “pursuant to the Contract, the gas price for Belarus calculated under the formula will stand at around USD 168 per 1,000 cubic meters in the first quarter of 2010. This year the average price for the natural gas supplied to Belarus was 11 per cent lower – around USD 150. Due to the absence of the export duty, natural gas price for Belarus is considerably lower as compared to other purchasers of Russian gas. At the same time, the previously agreed period of transition to higher prices enables the Belarusian economy to adapt to the new conditions”.

Background:

On December 31, 2006 Gazprom and Beltransgaz signed the Gas Supply and Transit Contract for 2007 through 2011. The Contract, inter alia, set the price formula starting from January 1, 2008 (which is in line with the price formula for Russian gas supply to Europe), and the discount rates to the market price for 2008–2010 (in particular, in 2010 the discount rate will be equal to 0.9). According to the Contract, Belarus, starting from 2011, will pay the gas price equally profitable to Gazprom with the price paid for gas deliveries to Europe.

In May 2007 Gazprom and the State Property Committee of the Republic of Belarus signed the Purchase and Sale Agreement for a 50 per cent stake in Beltransgaz worth USD 2.5 billion. Pursuant to the Agreement, Gazprom is to pay the above mentioned sum in equal portions within four years. At present, Gazprom holds a 37.5 per cent stake in the company; in 2010 the transaction will be completed.