The Gazprom Headquarters hosted today a working meeting between Alexey Miller, Chairman of the Company’s Management Committee and Eduard Kokoity, President of the Republic of South Ossetia.

The discussion centered on the issues of Russian gas supplies to South Ossetia through the Dzuarikau – Tskhinval gas pipeline. It was highlighted that delivery of natural gas via the new route had considerably raised the security of gas supply to the Republic.

The parties stressed that the Dzuarikau – Tskhinval gas pipeline had given a powerful impetus for developing the gasification in South Ossetia, boosted the industrial growth, raised the living standards and improved the ecology in the Republic.

The meeting discussed the issue of establishing and running a joint venture in South Ossetia.

“Construction of the vitally important Dzuarikau – Tskhinval gas trunkline was performed on a tight deadline. I am sure that from this moment the national economy will start to recover at a rapid pace,” noted Alexey Miller.

Background:

The Dzuarikau – Tskhinval gas pipeline was put onstream on August 26, 2009.

The total length of the pipeline accounts for 162.3 kilometers, the throughput capacity – 252.5 million cubic meters per annum.

Initiated in late 2006, the gas pipeline construction was carried out in a harsh geological and climatic environment of the mountainous part of the Great Caucasus. Almost a half of the route (75.4 kilometers) passes through highlands at a height of over 1,500 meters in the areas of high seismic activity and the hazards of landslides, mudflows, and avalanches. Such hazardous areas may stretch up to several thousand meters, while the tectonic fault lines may vary in length between 2 and 15 kilometers. There were constructed 15 tunnels with the total length of 1,848 meters and 29 water crossings. The route passes five mountain ridges and rises to the point of 3,148 meters at the Kudar Pass. The Dzuarikau – Tskhinval gas pipeline is the highest altitude one in the world.

Until recently, South Ossetia was supplied with Russian pipeline gas via the Agara – Tskhinval gas lateral from the Tbilisi – Kutaisi gas trunkline. The risk of supply interruptions was considerably high due to geopolitical reasons.

Russia also supplies South Ossetia with liquefied petroleum gas (LPG). At the same time, uninterrupted LPG supplies to South Ossetia’s population centers largely depend on the complex natural and climatic conditions (mountainous area, frequent snowdrifts, avalanches, rock falls and mountain creeps).

Since August 2008 Gazprom has been taking actions aimed at reconstructing gas supply facilities in the Republic of South Ossetia ruined as a result of armed hostilities. Over this period a gas distribution station was constructed anew and gas distribution networks were fully reconstructed in Tskhinval. On January 24, 2009 natural gas supply to consumers was resumed.