Gazprom and the Orel Oblast Government have signed an Agreement on wider use of natural gas as a transportation fuel. The Agreement will be effective for an indefinite period of time.

Pursuant to the document, the parties have agreed to take a set of actions in the region in order to increase the number of utility service, agricultural, and other motor vehicles powered by natural gas. The actions will be synchronized with construction of CNG filling stations, multi-fuel filling stations, natural gas vehicle (NGV) conversion and maintenance centers. Synchronized construction and commissioning schedules will be developed by the parties for each CNG and multi-fuel filling station.

The Orel Oblast Government will facilitate endorsement of the regional legislative acts regulating and promoting the use of natural gas as a transportation fuel.

The Oblast Government will allocate money from the local budget and other sources in order to expand the NGV fleet, to provide companies with machinery and equipment for NGV operation, as well as to train engineers, technicians and drivers.

In its turn, Gazprom will arrange construction and operation of NGV infrastructure in the Oblast according to the synchronized schedules. In addition, the Company will provide mobile filling facilities for the locations where NGVs are concentrated and specially designated sites are available.

Gazprom will provide regional NGV operators with regulatory documents and technical specifications, instruct their engineers, technicians and drivers on maintenance rules, as well as assist them in arranging maintenance and repair work.

Background:

The Agreement of Cooperation between Gazprom and the Orel Oblast Government was signed on May 21, 2001.

Gazprom has built two CNG filling stations in the Orel Oblast, which are currently operational. There are more than 3.5 thousand NGVs in the Oblast.

By now, Gazprom has signed the Agreements on wider use of natural gas as a transportation fuel with the Kaluga and Tambov Oblasts, similar Contracts have been signed with the Ryazan and Penza Oblasts.

The Russian fleet of NGVs accounts for some 100 thousand units. At present, there are 244 CNG filling stations (204 of them are owned by Gazprom) in 60 regions of the Russian Federation. The aggregate annual capacity of CNG filling stations averages 2 billion cubic meters of gas.

In 2009 over 330 million cubic meters of gas were sold via Russian CNG filling stations. This helped the domestic companies utilizing gas-powered vehicles save RUB 3.8 billion and reduce atmospheric pollutants emissions by 120 thousand tons.