The Gazprom headquarters hosted today a working meeting between Alexey Miller, Chairman of the Company’s Management Committee and Paolo Scaroni, Chief Executive Officer of ENI.

The parties addressed the current state of and development prospects for cooperation in the oil and gas sector. The parties dwelled on the entry of France’s EDF into South Stream AG and the progress in the activities stipulated by South Stream’s pre-investment stage. It was noted that the project was implemented in full compliance with the schedule.

Alexey Miller and Paolo Scaroni also addressed issues related to cooperation deepening as part of joint projects in Italy, Russia and third countries.

Background:

Italy is the third largest Russian gas importer in Europe. In 2009 Gazprom supplied Italy with 19.1 billion cubic meters of natural gas.

In November 2006 Gazprom and ENI entered into the Strategic Partnership Agreement providing Gazprom with the opportunity to directly supply Russian gas to the Italian market starting from 2007. Gas supply volumes are gradually increasing to 3 billion cubic meters a year by 2010. Under the Agreement the existing contracts for Russian gas supplies to Italy have been extended till 2035.

On June 23, 2007 Gazprom and ENI signed the Memorandum of Understanding for the South Stream project execution. The Memorandum sets the directions of cooperation between the two companies in the South Stream engineering, financing, construction and management fields.

On May 15, 2009 Gazprom and ENI signed the second Addendum to the Memorandum of Understanding on the South Stream project implementation stipulating an increase in the annual throughput capacity of the pipeline’s offshore section from 31 to 63 billion cubic meters of gas and regulating gas marketing issues within the project.

On January 18, 2008 the special-purpose company South Stream AG was registered in Switzerland. The founders of the company, on a parity basis, are Gazprom and ENI.

On June 19, 2010 Gazprom, ENI and EDF signed the trilateral Memorandum providing for specific steps towards the French company’s entry in the shareholding structure of South Stream AG which is to be accomplished by late 2010 through a reduction of ENI’s stake in the joint venture.