On June 8-9, Gazprom’s delegation headed by Bogdan Budzulyak, Gazprom’s Management Committee Member and Head of the Company’s Gas Transportation, Underground Storage and Utilization Department, paid a visit to the Russian machine building companies producing equipment for Gazprom’s needs.

The delegation visited the Volgogradneftemash company (the city of Volgograd) producing large-sized equipment and pipeline fittings for Gazprom as well as the Volzhsk Pipe Plant (the town of Volzhsk) supplying the Company with large diameter pipes.

Meeting heads of the aforementioned companies, A. Ananenkov pointed out once again that Gazprom and Russian machine builders’ joint activities should mainly aim to organize manufacturing of domestic high-quality products that could adequately compete with foreign counterparts.

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At present, Gazprom tends to reduce the share of its overseas purchases of drilling, oil and gas production equipment, gas pumping units, compressor units, control systems and pipes. In 2001, the ratio of the above-mentioned products in the corporate procurement system accounted for 17.6%, including 14.4% acquired from outside the FSU. In 2003, the same parameters equated to 15.9% and 6.4%, respectively.

While giving wide backing to its contracting organizations, Gazprom puts forward a string of the following requirements to machine builders:

• block-type equipment manufacturing
• maximum readiness of factory-tested equipment
• improved equipment reliability
• developed repair and maintenance system
• reduced product value and shipment timing

Starting 1998, Gazprom and Russian pipe manufacturers have been building up their relationships within the Agreements and Programs on sci-tech cooperation, aimed at designing and developing the new pipe manufacturing equipment to provide the gas industry facilities with products meeting stringent operational requirements.

In consequence of Gazprom’s interaction with the Volzhsk Pipe Plant, for the 1st time in its history Russia launched production of 1,420 mm pipes. In 2003, the Volzhsk Pipe Plant manufactured some 100 thousand tons of these pipes, with some 220 thousand tons targeted for this year.

In 2003, Gazprom acquired 640 thousand tons of various-typed pipes, including 340 thousand tons, in Russia and 300 thousand tons, abroad (including 250 thousand tons, in the Ukraine).

Just like in the past, most pipes purchased by the Company overseas are 1,420 mm pipes. This is due to the inability of Russian pipe plants to fully meet Gazprom’s needs for large diameter pipes.

DIVISION OF RELATIONS WITH MASS MEDIA