GAZPROM AND MURMANSK REGION INK COOPERATION AGREEMENT

Today, at Gazprom’s Headquarters, Alexey Miller, Gazprom’s Management Committee Chairman and Yury Yevdokimov, Governor of the Murmansk Region have inked a five-year Cooperation Agreement.

By signing the Agreement, the parties confirm mutual interest in stepping up the following paramount activities in the Murmansk Region:

• developing and implementing the Barents offshore oil and gas fields development programs, including the Shtokman field project, with a special working group to be set up for that purpose;
• implementing gas pipeline and processing & transmission infrastructure construction projects;
• erecting infrastructure for cargo reception, transfer and storage and gas & its processing products sea-borne transportation;
• developing capacities spurring the use of compressed and liquefied natural gas as motor fuel;
• supplying gas to localities, creating and developing a sustainable gas supply system in the Murmansk Region;
• making use of the Murmansk Region’s industrial capacities;
• developing and introducing gas saving technologies.

The Regional authorities will assist Gazprom in performing design & survey and construction works in the Region, providing Gazprom and its subsidiaries with land for the construction of the Shtokman gas condensate field infrastructure and organizing liquefied gas production and transmission. Furthermore, the authorities will help Gazprom and its subsidiaries officially register their ownership of real estate and land plots.

Additionally, the Regional Government will contribute to enacting legislation fixing tax benefits for the companies engaged in targeted investment and social gas supply programs.

The parties will also take measures to improve the Regional energy balance and will promote the implementation of high-efficiency projects in the Murmansk Region with the view of expanding the competitive products manufacture for Gazprom’s needs.

Reference:

With no gas mains, laterals and distribution networks constructed, the Murmansk Region isn’t currently supplied with natural gas.

The Shtokman gas condensate field is located in the central Russian sector of the Barents Sea offshore, 650 km from the port of the Murmansk city.

With four gas condensate reservoirs discovered and productive strata depth ranging between 1,813 – 2,479 m, the field tapped gas and condensate reserves account for 3.2 tcm and 30.97 mln t, respectively.

In September of this year, Gazprom made up a short-list of the firms (including Statoil, Total, Chevron, Hydro and ConocoPhillips) – its potential partners in developing the Shtokman gas condensate field.

Based on the talks outcome, Gazprom is resolute to select in the first quarter of 2006 two or three companies that will enter a consortium for the Shtokman project implementation.