RELEASE

Gazprom Management Committee addresses implementation of strategy for power sector

The Management Committee took notice of the information on the implementation of Gazprom’s Strategy for the Power Sector, endorsed by the Company’s Board of Directors in April 2007.

It was pointed out that during the Strategy implementation period Gazprom had become Russia’s top company in terms of electric power generation and marketing, and the country’s second-largest company in terms heat power generation.

The relevant business units were entrusted with carrying forward the Strategy implementation related work and preparing materials for the review of this issue at a Board of Directors’ meeting.

Background:

Gazprom’s Strategy for the Power Sector was ratified by the Company’s Board of Directors in April 2007. In accordance with the document, the strategic business development targets of Gazprom in the power industry are increasing the Company’s capitalization through bigger returns on capital, optimizing the national energy mix and achieving a synergetic effect in the gas and power sectors.

Gazprom’s Power Strategy hinges on the following basic elements:

• access to a free electricity pricing regime and regulatory risk diversification;
• profit realization from power generation;
• synergetic effects of vertical integration;
• subsidiary power supply optimization;
• investment potential utilization for key assets of generation companies;
• risk hedging;
• energy mix diversification in Russia’s power sector.