Led by Alexey Miller, the Company’s Management Committee Chairman, Gazprom’s delegation has completed its visit to Venezuela, holding a meeting with Hugo Chavez, President of the Bolivarian Republic of Venezuela and conducting negotiations with Rafael Ramirez, Venezuelan Energy & Mines Minister and President of Petroleos de Venezuela SA (PDVSA).

In the presence of Venezuela’s President Hugo Chavez, Alexey Miller and Rafael Ramirez signed a Memorandum of Understanding.

The Memorandum outlines joint businesses in the energy sector: gas field exploration & development, oil & gas transmission infrastructure development, gas deliveries, natural gas processing, innovative technology introduction and staff training. The parties also agreed to explore potential natural and liquefied gas shipments from Venezuela to third countries.

To develop certain projects, a joint Coordinating Committee is being set up.

“The Gazprom and PDVSA union is strategically crucial for us. Searching for and implementing joint projects will promote economic relations, friendship and cooperation between Venezuela and Russia as well as will buoy the global hydrocarbon market,” – said Rafael Ramirez on signing the Memorandum.

“The Memorandum signed today lays strong foundations for long-term cooperation between Gazprom and PDVSA, including in the sector of large-scale projects focusing on oil and gas exploration & production and hydrocarbon marketing & experience sharing. I’ am positive that joint projects will contribute to solidifying both parties’ standings on the global oil and gas market,” – maintained Alexey Miller.

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Being the second-largest in the Western Hemisphere after the USA, Venezuela’s proved natural gas reserves account for 4.1 tcm. In 2003, Venezuela extracted some 30 bcm of mainly associated petroleum gas. The country does not import or export gas and the entire gas amount produced is channeled to domestic consumers. Natural gas, oil and hydropower generation shares in Venezuela’s fuel and power balance stand for 41%, 38% and 21%, respectively. Total length of the country’s gas pipelines accounts for 5 thousand km.

Venezuela’s proved oil reserves amount to 11.2 bln t (7% of the global reserves), with Maracaibo, Falcon, Oriental and Apure being the largest oil fields. Over 2003, Venezuela recovered 153 mln t, consumed 24 mln t and exported over 100 mln t of oil. The USA is the major importer of Venezuelan oil.

Although the exclusive right to produce natural gas is being held by the Venezuelan state-run oil and gas firm Petroleos de Venezuela SA (PDVSA), a limited number of joint ventures set up by PDVSA and foreign investors have been licensed to do it, as well.

In 1999, the Venezuelan Government enacted the Gas Law stipulating the inflow of foreign investments into the domestic gas industry.

DIVISION OF RELATIONS WITH MASS MEDIA