Alexander Ananenkov, Deputy Chairman of the Gazprom Management Committee held a meeting dedicated to the current status and implementation of the gas supply projects for the Far East and Kamchatka Krai.

Participating in the meeting were Oleg Aksyutin, Head of the Gas Transportation, Underground Storage and Utilization Department, Yaroslav Golko, Head of the Investment and Construction Department, heads and experts of the relevant business divisions of Gazprom’s Administration and subsidiaries: Gazprom invest Vostok, Mezhregiongaz, Gazprom promgaz, Giprogaztsentr, Gazkomplektimpex.

The meeting considered the current issues of the Sakhalin – Khabarovsk – Vladivostok gas trunkline design and engineering. Special attention was paid to the compliance with the investment project deadlines. It was pointed out that that the engineering of the Sakhalin – Khabarovsk – Vladivostok gas trunkline facilities required for launching the construction work in 2009 and gas supply to Vladivostok in the third quarter of 2011 was progressing in line with the schedule.

The airborne photographic survey and laser scanning have been fully implemented across the gas pipeline route; the engineering survey is nearing completion. The contest-related documents are under development for the purposes of a competitive bidding aimed at selecting suppliers of key technological equipment and building contractors.

The meeting participants addressed the implementation of the Kamchatka Krai gasification project involving the construction of the Sobolevo – Petropavlovsk-Kamchatsky as well as pre-development of the Kshukskoye and Nizhne-Kvakchinskoye gas and condensate fields. The project is being implemented on schedule: first natural gas will be supplied to consumers in Petropavlovsk-Kamchatsky in the fourth quarter of 2010. Over 100 km of line pipe will be constructed in 2008, in-field operations will commence in 2009.

Based on the meeting results Gazprom’s specialized divisions and subsidiary companies were entrusted with ensuring timely implementation of the projects for natural gas supply to the Far East regions.

Background:

The September 2007 Order by the Russian Federation Industry and Energy Ministry approved the Development Program for an integrated gas production, transportation and supply system in Eastern Siberia and the Far East, taking into account potential gas exports to China and other Asia-Pacific countries (Eastern Gas Program). Gazprom was appointed by the Russian Federation Government as the Program execution coordinator.

The Eastern Gas Program prioritizes, inter alia, constructing and developing the Sakhalin – Khabarovsk – Vladivostok gas pipeline system to be connected with the Yakutia – Khabarovsk – Vladivostok gas pipeline in future.

In September 2007 the Russian Federation Government adopted the decision prescribing Gazprom to get involved in the Gas Supply to the Kamchatka Oblast, Phase 1. Gas Supply to Petropavlovsk-Kamchatsky project and gave specific instructions on the relevant issues within the project. The gas pipeline was requested to be completed in 2010.

The project envisages developing a number of small gas condensate fields on the western coast of the Kamchatka Peninsula (Kamchatgazprom holds the relevant development licenses), and constructing the Sobolevo – Petropavlovsk-Kamchatsky gas trunkline, as well as distribution networks in Petropavlovsk-Kamchatsky.

Gazprom invest Vostok (a wholly-owned subsidiary of Gazprom) was assigned the customer of investment projects for the construction of the Sakhalin – Khabarovsk – Vladivostok, Yakutia – Khabarovsk – Vladivostok, as well as Gas Supply to the Kamchatka Oblast, Phase 1. Gas Supply to Petropavlovsk-Kamchatsky gas trunklines.