Ukhta hosted today a joint meeting dedicated to the Bovanenkovo – Ukhta gas trunkline system construction as well as the Republic of Komi gasification prospects. The meeting was co-chaired by Valery Golubev, Deputy Chairman of the Gazprom Management Committee and Vladimir Torlopov, Head of the Republic of Komi.

Taking part in the meeting were Viktor Ilyushin, Member of the Gazprom Management Committee, Head of the Department for Relationships with Regional Authorities of the Russian Federation as well as heads and experts of the Gazprom Administration’s core business units and subsidiaries: Gazprom transgaz Ukhta, Yamalgazinvest, Mezhregiongaz, Gazpromregiongaz, Gazprom invest Zapad, Gazprom Promgaz and Giprospetsgaz; representatives of the Republican Government and heads of the municipal districts as well as top managers of large enterprises located in the Republic.

The meeting participants discussed issues relevant to ensuring interaction between the Republic of Komi authorities and the companies engaged in the construction of the Bovanenkovo – Ukhta gas trunkline system.

The meeting also addressed issues related to the preparation of consumers for gas supply during the regional gasification process. Special emphasis was put on the necessity to observe the schedule plan regulating the preparation of consumers for gas supply as well as the implementation of energy and gas saving programs as early as at the stage of consumer preparation.

Following the meeting results the core business units of Gazprom and the Komi Government as well as Gazprom transgaz Ukhta, Giprospetsgaz, Gazkomplektimpex, Gazprom invest Zapad and Mezhregiongaz were entrusted with the tasks related to the organizational support of the Bovanenkovo – Ukhta gas trunkline system construction and gas supply to consumers.

Background:

In January 2002, the Gazprom Management Committee identified the Yamal Peninsula as a region of the Company’s strategic interest. The commercial development of the Yamal fields will increase local gas production to 250 bcmpa. Accessing the Yamal is of utter importance for the purpose of ensuring gas production growth.

The Cenomanian-Aptian deposits of the Bovanenkovo field are a paramount development target on the Yamal. It is anticipated to increase projected gas production at the Bovanenkovo field from current 115 bcmpa to 140 bcmpa in the long-term. In order to deliver the extracted gas to the UGSS, it is necessary to build a 2,451-km-long gas transmission network including a new 1,100-km-long gas transmission corridor – the Bovanenkovo – Ukhta gas trunkline system.

In October 2006, the Gazprom Management Committee reviewed the progress in compiling the Investment Rationale for the pre-development of the Bovanenkovo field on the Yamal Peninsula, and for gas transportation. The Committee ordered to initiate the investment stage of the Bovanenkovo oil and gas condensate field development and gas main network construction.

Gazprom’s core business units were tasked to ensure the commissioning in the 3rd quarter of 2011 of the first startup complexes (rated at least at 15 bcmpa of gas) intended for the pre-development of the Cenomanian-Aptian deposits of the Bovanenkovo field as well as of the Bovanenkovo–Ukhta gas trunkline system.

The Republic of Komi is a strategically crucial partner for Gazprom.

The Northern Tyumen Oblast (SRTO) – Torzhok gas main is nearing completion. By now, the 336.4-km-long linear part of the gas pipeline has been completed. The work is underway on the construction of workshops at the compressor stations.

Since 2007, activities aimed at the construction of the Bovanenkovo–Ukhta gas trunkline system facilities have been going on in the Republic of Komi.

Natural gas penetration in the Republic of Komi accounts for 42.6 per cent including 56 per cent in cities and towns and 5.7 per cent in the rural area. The identical Russia-averaged parameters make up 62, 67 and 44 per cent respectively.

Between 2006 and 2007 Gazprom allocated RUB 236 mln to gasify the Republic of Komi.

In 2008 Gazprom will invest a further RUB 220 mln. These funds will be used to perform engineering and construction of five inter-settlement gas pipelines.