Today, at Gazprom’s Headquarters, Alexey Miller, Chairman of Gazprom’s Management Committee and Nikolai Vinogradov, Governor of the Vladimir Region have inked a network schedule for the construction of gasification facilities in the Vladimir Region.

In compliance with the network schedule the parties will perform in the Region a whole range of activities aimed at preparing consumers for gas deliveries by Gazprom’s gas pipelines currently undergoing large-scale construction as stipulated by the gasification program for RF regions over 2005 to 2007.

“Our main goal is to synchronize the Gazprom and Regional leadership’s activities aimed at constructing gasification infrastructure and preparing consumers for gas deliveries, respectively.

At present gasification rates substantially vary in cities, towns, settlements and villages. And while implementing the gasification program throughout Russia, the Vladimir Region inclusive, we will therefore pay special attention to rural gasification,” said Alexey Miller.

“The amount of budgetary and third-party funds needed for the preparation of consumers for gas supply exceeds RUR 300 mln. Extra finance will be raised at the expense of some consumers willing to have their premises gasified. Between 2005 and 2007 the Vladimir Region’s authorities intend to construct 164 km of in-settlement gas pipelines, convert 17 heating plants to natural gas and gasify 5,717 households,” pointed out Nikolai Vinogradov.

The network schedule signing was preceded by a working meeting between Dmitry Medvedev, RF First Deputy Prime Minister & Chairman of Gazprom’s Board of Directors and Nikolai Vinogradov. The parties discussed issues surrounding the implementation of the gasification program for RF regions over 2005 to 2007 in the Vladimir Region.

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The network schedule of gasification identifies an activity list and implementation date for gas infrastructure between 2006 and 2007, and is aimed at providing gas connections to consumers immediately upon pipeline completion. To connect consumers, regional authorities are to construct local and household networks, build new or convert to gas existing heating plants, install household gas appliances, etc.

Network schedules are signed for the implementation of Gazprom’s gasification program for RF regions over 2005 to 2007, which is funded with RUR 35 bln. Of this amount, RUR 5.2 bln was already committed in 2005 and not less than RUR 17.6 bln and RUR 12.2 bln is slated for 2006 and 2007, respectively. Extra RUR 1.1 bln will be allocated for the reconstruction and modernization of existing gas distribution pipelines.

At present the Russia-averaged level of gasification makes up 53 per cent including 60 per cent in cities & towns and 34 per cent in rural area.

Implementing the gasification program over 2005 to 2007 will help boost gas supply to Russian regions to a 60 per cent average by 2008 already, including to 66 per cent in cities & towns and 42 per cent in rural area.

To achieve said targets, Gazprom will provide gasification of a further 3,851 thousand apartments & households including 2,673 thousand in cities & towns and 1,178 thousand in rural area.

The Program will enable Gazprom to convert to natural gas about 20 thousand new residential facilities (hospitals, kindergartens, schools, etc.), over 5 thousand heating plants in villages & settlements and more than 500 agricultural companies, with an excess of 12 thousand km of pipelines to be laid and some 11 mln citizens of 53 Russian regions to be serviced.

Gazprom’s investment priorities for regional gasification are determined based on the following criteria: full payments for gas deliveries; repayment of gas debts; economic viability of projected gas infrastructure; customers’ readiness to receive gas; actual loading of gas laterals and distribution stations; assistance of RF regional authorities in promoting the use of compressed and liquefied natural gas as motor fuel.

Gazprom and the Government of the Vladimir Region signed a five-year Agreement on cooperation on September 24, 2002. To promote the Agreement, the parties sealed an Accord on gasification on November 5, 1999.

Over 2005 Gazprom provided the Vladimir Region with some 3 bcm of gas.

As of March 1, 2006 the Regional gas debt to Gazprom has accounted for RUR 318.58 mln, with the bulk owed by the household sector.

The actual average loading of Regional branch pipelines is at 28 per cent versus 25.5 per cent throughout Russia, with the optimum yearly average loading making up 60%.

The Vladimir Region is currently gasified by 68 per cent including by 82 per cent in cities, towns & population centers and 21 per cent in rural area.

The gasification program for RF regions over 2006 stipulates 8 local gas pipelines being constructed in the Vladimir Region.