Today, at Gazprom’s Headquarters, Alexey Miller, Gazprom’s Management Committee Chairman and Georgy Shpak, Governor of the Ryazan Region have entered into a five-year Cooperation Agreement.

Prior to signing the Agreement, the parties addressed the Regional natural gas debt growth over 2005, underscoring that Gazprom would further earmark funds for the gas consumption intensification in the Region depending on the existing arrears clearance rates.

The Agreement stipulates cooperation deepening between the parties in the following key businesses:

- Devising a General Scheme of gas supplies to the Ryazan Region;

- Expanding gas deliveries to cities, towns, localities and rural settlements;

- Developing capacities spurring wider use of compressed and liquefied gas as motor fuel;

- Developing and introducing gas saving technologies;

- Ensuring environmental safety and rational nature management;

- Creating a comprehensive automated natural gas consumption and quality measurement system on the platform of the gas metering units used in the transmission, distribution, industrial and residential sectors.

The parties will jointly step up measures aiming to improve the Regional energy basket and use alternative energies on a larger scale.

Gazprom will, on its part, provide reliable natural gas deliveries to the Ryazan Region’s consumers given the United Gas Transmission System capacities, gas quotas annually allocated throughout Russia, adequate gas demand and solvent consumers.

Reference:

Gazprom and the Ryazan Region first entered into a Cooperation Agreement in February 2000. To promote the Agreement, the parties sealed a Gas Supply Contract in January 2003.

In 2004, Gazprom provided Regional customers with some 4.5 bcm of gas and roughly the same amount is slated for 2005.

Under Gazprom’s estimates, the natural gas supply infrastructure of the Ryazan Region is developed by 67.5% of maximum demand, including by 87.9%, in cities, towns & localities and 34.2%, in rural area (the identical Russia-averaged parameters account for 53%, 60% and 34.7%, respectively). In accordance with its programs on gas supplies to the RF constituents between 2002 and 2004, Gazprom channeled RUR 268.95 mln to construct gas distribution grids in the Ryazan Region.

Starting 2002, the Regional customers’ natural gas debt has jumped RUR 137.62 mln to RUR 224.62 mln, as of 1 May, with the bulk of the debt owed by the population (RUR 66.42 mln) and utilities (RUR 144.38 mln).

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