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

The network schedule signed is targeted at connecting local and household gas grids to distribution systems immediately upon completion of pipeline construction works as stipulated by the Gazprom gasification program for RF regions over 2005 to 2007.

“Within a year Gazprom intends to construct 16 local gas pipelines in the Volgograd Region and the Regional authorities have taken the commitment to step up all necessary measures to avoid any delay in gas supply. We are completely positive that the Regional gasification rate will be on a significant rise after the schedule fulfillment,” said Alexey Miller.

“Between 2005 and 2007 the Regional leadership plans to construct 193 km of local gas pipelines, convert 73 heating plants to natural gas and gasify 7,684 households, with RUR 500 mln to be committed for preparing consumers for gas deliveries,” said Nikolai Maksyuta.

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 Maksyuta. The parties discussed issues surrounding the implementation of the gasification program for RF regions over 2005 to 2007 in the Volgograd 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 Volgograd Region signed an Agreement on cooperation on September 17, 2002.

Over 2005 Gazprom provided the Region with some 5.9 bcm of gas.

The actual loading of Regional branch pipelines averages 19 per cent versus 25.5 per cent throughout Russia.