Gazprom’s Management Committee examined the implementation of the 2002-2003 Program on the gas industry resource base development for the period up to 2030.

Gazprom’s core business departments were commissioned to produce proposals for amending the aforementioned Program, taking into account the following corporate priorities: additional prospecting of and searching for new fields located within a short distance of the Russian United Gas Transmission System; establishing a comprehensive gas production system in Eastern Siberia and the Far East; ensuring liquid hydrocarbon production build-up; conducting geological exploration abroad, subject to the gas market demand.

The Management Committee also ordered the Company’s relevant departments to make up within a month’s time a plan of measures aimed at enhancing the exploration efficiency, in particular, at reducing the timing and improving the quality of the exploratory wells construction. The existing exploration planning and execution system is supposed to be updated, as well: prospecting contracts will shortly be concluded not just for a certain period but until a full scope of works is completed.

The Management Committee also addressed the problem related to the absence of legal documentation that guarantees production licenses awarding to exploration licensees making investments in prospecting. As it was pointed out, this state of affairs not only infringed upon the prospecting licensee’s interests but slowed down full-scale replenishment of the country’s resource base.

Reference:

The Program on the gas industry resource base development for the period up to 2030 was devised in 2002. The Program determines main directions of Gazprom’s prospecting activities and licensing policy targeted at developing Russia’s resource base.

Due to the Program implementation from 2002 to 2003, the Company discovered 9 hydrocarbon fields and 7 deposits, achieving the total production build-up of 955.9 million tons of fuel equivalent, 926.7 bcm of gas, inclusive. The reserve replenishment coefficient grew from 0.32 in 2001 to 0.79 in 2003, which is in line with the Program targets over this period.

The most significant results achieved in implementing the Program are as follows:

• Discovery of the Severo-Samburgskoye, Yuzhno-Parusovoye, Lenskoye, Severo-Kamennomysskoye and Kamennomysskoye-sea fields
• Discovery of new formations in the Achimov and Jurassic deposits of the Urengoiskoye, Yamburgskoye and Pestsovoye fields
• Considerable build-up of commercial hydrocarbon production from the Achimov sediments of the Urengoiskoye field (Western Siberia), Zapadno-Pechorogorodskoye and Yugid-Soplesskoye fields (onshore fraction of the Timano-Pechora Province), Pestsovoye field (Orenburg Region), Vostochno-Pribrezhnoye high-producing gas condensate field and new deposits of the Pribrezhnoye field (Krasnodar Area).

From 2002 to 2004, Gazprom obtained 32 new development licenses and, thus, built up the Company-owned resource base to 250 bcm of gas and 30 million tons of liquid hydrocarbons. As a result, the corporate gas and liquid hydrocarbon reserves grew 2.1 tcm and 620 million tons, respectively. As of 1 April 2004, Gazprom, its subsidiaries and associated undertakings held 159 exploration and production licenses, including 126 licenses owned by Gazprom’s 100%-controlled subsidiaries. Thus, Gazprom controls 28.0 tcm of gas reserves and actually owns (100%) 26 tcm.

DIVISION OF RELATIONS WITH MASS MEDIA