Gazprom’s Board of Directors resolved yesterday to place three A ruble bond issues, worth RUR 5 billion each and with a maturity of 3, 4 and 5 years, respectively.

The bonds are planned to be floated in 2004/2005, subject to the gas market situation and the corporate cash needs.

Gazprom intends to arrange for simultaneous registration of the 3 above-mentioned bond issues and, thus, will obtain an opportunity to swiftly respond to potential changes on the gas market and to decide on the floatation date of the issue with the best parameters under the existing market conditions.

The funds attracted will be channeled for financing the Company’s current production operations, implementing new promising projects, re-financing Gazprom’s long-term debt and optimizing the corporate loan portfolio.

Reference:

Gazprom placed its 1st A1 RUR 3 billion bond issue in July 1999 and repaid it in April 2003. The 2nd A2 RUR 5 billion bond loan took place in November 2002.

On 3 February 2004, Gazprom successfully placed the A3 RUR 10 billion bonds with a 3-year maturity. The bonds were floated at 100.69% of the face value, which is 8% of effective annual yield. The transaction became the largest loan ever taken in the history of the Russian capital market.

DIVISION OF RELATIONS WITH MASS MEDIA