Today at the Gazprom Headquarters Alexey Miller, Chairman of the Company’s Management Committee and Vyacheslav Pozgalev, Governor of the Vologda Oblast signed an Agreement of Cooperation between Gazprom and the Vologda Oblast Government for 2010.

Under the document, the parties confirm their mutual interest in performing Gazprom’s strategic projects in the region. They include construction of the Northern Tyumen Regions – Torzhok (SRTO – Torzhok), the Gryazovets – Vyborg, the Pochinki – Gryazovets gas pipelines and the Ukhta – Torzhok gas trunkline system.

The Agreement provides for taking actions in the Vologda Oblast prescribed by the 2010 Russian Regions Gasification Program, as well as elaboration and execution of programs for wider natural gas utilization as a motor fuel.

According to the document, the Vologda Oblast Government will assist Gazprom in coordinating all types of the work related to the Company’s strategic projects execution in the region, particularly, in land plots allocation.

The Oblast Government will develop and adopt the schedule for converting the Oblast’s enterprises to standby fuels during cold snaps and establish control over the timely build-up of standby fuel reserves. The Government is also obliged to prepare consumers for gas deliveries at the gasification facilities constructed by Gazprom.

The Company, on its part, will secure natural gas supplies to the Vologda Oblast consumers. When performing gas trunklines construction work in the Oblast, Gazprom will engage local enterprises, through competitive bidding, to procure the required equipment and materials.

During the meeting Alexey Miller and Vyacheslav Pozgalev discussed the progress in implementing the Agreement of Cooperation between Gazprom and the Vologda Oblast Government. Special attention was paid to the regional gasification issue. For instance, the parties addressed the possibility to construct gas laterals to the village of Berezovaya Slobodka, Nyuksensky District, to the settlement of Turovets, Mezhdurechensky District, as well as to the town of Ustyuzhna with branches to the villages of Dubrovka and Danilovskaya, Ustyuzhensky District.

Background:

Gazprom and the Vologda Oblast Government signed the Agreement of Cooperation in June 2003 and the Accord on Gasification – in January 2005.

Gazprom supplies natural gas to the Oblast consumers in the agreed amount.

The gasification level in the Vologda Oblast is at 52.6 per cent including 77.4 per cent in cities and towns and 13.6 per cent in the rural area. The identical figures throughout Russia account for 62, 67 and 44 per cent respectively.

This year Gazprom invested RUB 35 million in the Vologda Oblast gasification. These funds were used to launch the construction of an inter-settlement gas pipeline, and three more pipelines are being designed.

The Oblast consumers have no indebtedness for supplied gas. As of November 1, 2009 the advance payments accounted for RUB 285.1 million.