Today Alexey Miller, Chairman of the Company's Management Committee approved Gazprom's Russian Regions Gasification Program for 2012.

As part of the Program, this year Gazprom is allocating for Russian regions gasification a record amount of investments – RUB 37.660 billion versus RUB 29.070 billion in 2011. Thus, the amount of financing for Russian regions gasification has been increased by nearly 30 per cent.

In 2012 Gazprom's Russian Regions Gasification Program covers 69 entities of the Russian Federation, including Eastern Siberia and the Far East, where the Eastern Gas Program is being implemented.

The implementation of gasification program for Russian regions is based on the General Gas Supply and Gasification Schemes as well as on synchronization schedules for Russian regions gasification. Gazprom's criteria for regional programs funding are discipline for current gas supplies payments and compliance with investment commitments undertaken by local authorities under the schedules of consumers preparation for gas supplies.

Background

Gazprom's gasification program influences on socioeconomic development of regions and living standards of people. From 2005 to 2011 the total volume of Gazprom's investments in Russian regions gasification exceeded RUB 146 billion (excluding Gazprom's funds allocated for gas laterals and gas distribution stations construction which are an integral part of regions' gasification). Thus, 1,292 gasification facilities were put into operation. Another 2,524 settlements were connected to gas.

As a result (according to the preliminary estimates), the Russia's average gasification level in early 2012 could grow 9 per cent – reaching 63.2 per cent (70 per cent in cities and towns and 46.8 per cent in the rural area).

Gasification of Russian regions is carried out jointly by Gazprom and federal constituents' authorities. Thus, the Company finances construction of the inter-settlement gas pipelines delivering gas to population centers, while regional authorities take on street-level networks laying and preparation of consumers for gas supplies. In order to ensure efficient execution of the gasification program, Gazprom and federal constituents' authorities enter into agreements of cooperation and accords on gasification. The Company and regional authorities annually approve the scope of work and the respective deadlines provided for in synchronization schedules for constructing the gasification facilities designated to connect consumers as soon as Gazprom completes the inter-settlement gas pipelines.