OAOOAO GazpromGazprom ShareholdersShareholders Meeting,Meeting, JuneJune 29,29, 20072007 Financial highlights
2005 2006 Changes Receipts from gas and other product 272.2 sales, RUR bln 1,231.3 1,632.7 32.6 %
Net profit, RUR bln 203.4 343.7 68.9 %
Dividends per share, RUR 1.502.54 69.3 %
160.4
66.2
31.9 12.8 18.5 Market capitalization, USD bln
12.31.2001 12.31.2002 12.31.2003 12.31.2004 12.31.2005 12.29.2006
2 Equity capital structure
2002 2003 2004 2005 2006
The share controlled by the Russian Federation 39.262% 39.262% 39.262% 50.002% 50.002%
including
The Federal Agency for Federal Property Management 38.373% 38.373% 38.373% 38.373% 38.373%
ОАО Rosgazifikatsiya0.889% 0.889% 0.889% 0.889% 0.889%
ОАО Rosneftegaz --- 10.740% 10.740%
ADR holders4.422% 4.422% 4.422% 4.422% 13.200%
Other registered persons and legal entities 56.316% 56.316% 56.316% 45.576% 36.798%
3 Share Market
The closing price of Gazprom’s shares at the The closing price of ADR on Gazprom’s St. Petersburg stock exchange shares at the London stock exchange* RUR USD
350.38 52.64 302.5 46.0 215 ceiling ceiling 29.48
year-end year-end 314 195 bottom bottom 28.68 194.3 11.92 69.6
15.76 84.7 14.2 76.57 10.9 44.45 7.86 10.36 10.5 35.45 40.55 38.5 4.68 4.16 24.02 21.1 3.88 15.64
2002 2003 2004 2005 2006 2002 2003 2004 2005 2006
•The ADR price reflects a new Gazprom’s shares/one ADR ratio (one ADR = four shares)
4 Reserves
Total 29,854.1 1,217.0 1,386.9
4,114.5 28.5 93.2 47.4 21.3 8.8 Offshore 13.5 0.1 Northwest FD 2.7
21,937.2 Far East FD 810.6 58.7 689.7 295.0 1,146.0 2,594.8 134.3 26.3 Gas, bcm 392.4 Volga FD Ural FD 38.5 Condensate, mln t 4.5 Siberian FD Oil, mln t Southern FD
5 Reserve buildup
Reserves Geological Reserves as at 12.31.05 exploration as at 12.31.06
Natural gas, bcm 29,130.7 590.9 29,854.1
Condensate, mln t 1,216.3 11.9 1,217.0
Oil, mln t 1,357.5 46.9 1,386.9
Three gas condensate and one oil fields discovered
Chikanskoye – Eastern Siberia
Yuzhno-Noyabrskoye – Western Siberia
Akobinskoye – Orenburg Oblast
Karmalinovskoye – Stavropol Krai
30 hydrocarbon reservoirs discovered
6 License Acquisitions
A total of 238 licenses held by Gazprom Group as at 12.31.2006
Hydrocarbon prospecting and production licenses – 169
Geological survey licenses– 59
32 subsoil use licenses obtained, including 9 licenses in Central Asia 7 Audit
Appraisal of Gazprom Current value Group’s А+В+С1 reserves Gazprom’s reserves
94% of gas 182.5 USD bln
94% of oil 26.1 90% of condensate USD bln Gazprom Neft’s reserves
8 Gas production
by 2030 – no less than 610-630 bcm
630 by 2020 – no less than 580-590 bcm
by 2010 – no less than 560 bcm 590
560 556 557 552.5 555 547.6
521.9
2002 2003 2004 2005 2006 2007 2010 2020 2030
9 Gazprom’s production capacities
Aneryakhinskaya
Yamburgskoye
Pestsovoye Yen- Kharvutinskaya Yakhinskoye Tab- Yakhinskaya
Urengoyskoye Yuzhno- Russkoye
Between 2002 and 2006 production capacities Yety- with a total design capacity Purovskoye of over 170 bcm/yr commissioned Vyngayakhinskoye
10 New gas production provinces in Russia’s offshore
Sakhalin Northeast Barents Sea offshore
Ludlovskoye Yamal offshore Fersman Rise
a y l Rusanovskoye Bely Island Ledovoye m Shtokman e Z Leningradskoye
a y a v Gydan Peninsula o Kharasaveyskoye N Kruzenshternskoye Antipayutinskaya Sev. Kildinskoye Pechora Sea offshore Sev. Kamennomysskoye Rybachiy Peninsula
V Prirazlomnoyeai Caspian ga Kildin island ch Is Dolginskoye la Obskoye Sea Murmanskoye nd Amderma Kamennomysskoye Sea Murmansk d Teriberka n la Is Medyn Sea v e K u Varandey Sea lg o o la K P e Kanin Peninsula Ob and Taz Bays n Yar-Sale in s u la Narian-Mar Salekhard
Oil and gas fields
Arkhangelsk Promising structures
11 Yamal - a new development stage for gas production and transportation
Rusanovskoye
Leningradskoye The Bovanenkovskoye field – Malyginskoye commissioning in 2011 of the first start-up Kharasaveyskoye complexes with a capacity of no less than 15 bcm Tambeyskaya group per year and a gas trunkline between Bovanenkovo
Bovanenkovskoye and Ukhta
Kruzenshternskoye
The aggregate reserves in the Bovanenkovskoye, Kharasaveyskoye and Novoportovskoye fields – Rostovtsevskoye 5.8 tcm of gas, 100.2 mln t of condensate, and 227 mln t of oil Novoportovskoye
Yamal’s explored gas reserves – 10.4 tcm 12 Eastern Russia
Udachny Yakutsk Sakhalin Russia Mirny centre Yakutsk centre Krasnoyarsk centre Komsomolsk- on-Amur Tyumen Tomsk Tynda Yuzhno- Sakhalinsk Boguchany Sovgavan Bogandinskaya CS Irkutsk Skovorodino to the USA Krasnoyarsk centre Khabarovsk Chelyabinsk Proskokovo Omsk Taishet Blagoveshchensk Novosibirsk Kansk Chita Kemerovo Abakan Zabaikalsk Barnaul Angarsk Irkutsk Novokuznetsk Ulan-Ude Gorno-Altaisk Nakhodka Vladivostok Kazakhstan Ulan -Bator Tokyo DPRK Mongolia Pyongyang Japan Korea Seoul Beijing
China
27% of Russia’s initial in-place resources – Shanghai more than 67 tcm
13 Oil business development Annual oil output by 2020 - 80 mln t 34
oil, mln t Oil and condensate reserves – 2.6 bln t condensate, mln t
Bringing onstream explored oil fields on a by-stage basis 11.5 11.4 9.5 Expanding the resource base
Developing the petrochemical sector, GTL technology 2005 2006
14 Gazprom’s gas transmission system
Current status The length of gas trunklines – 156.9 thousand km including spur lines – 44.5 thousand km
Compressor stations – 217 Gas pumping units – 3,629 with a total installed capacity of 41,000 MW
In 2006 717.8 bcm of gas was fed into Gazprom’s gas transmission system, including 115 bcm injected by independent producers
15 New gas pipeline routes
SWEDEN
NORWAY FINLAND
RUSSIAN FEDERATION IRELAND
ESTONIA DENMARK
GREAT BRITAIN LATVIA LITHUANIA MOSCOW
KAZAKHSTAN
BELARUS
CZECH POLAND GERMANY REPUBLIC UKRAINE SWITZERLAND FRANCE SLOVAKIA PORTUGAL AUSTRIA
ВЕНГРИЯ MOLDOVA SPAIN ROMANIA CROATIA UZBEKISTAN BOSNIA ITALY
YUGOSLAVIA BULGARIA GEORGIA TURKMENISTAN
MOROCCO
АЛЖИР ТУНИС Nord Stream Possible gas transmission route ТУРЦИЯ from the Shtokman field Gryazovets – Vyborg Sokhranovka CS–Oktyabrskaya CS gas pipeline South Stream Kasimovskoye UGS site – Izobilnoye CS gas pipeline NTO – Torzhok Urengoy transit centre expansion 16 Shaping a gas pipeline system in eastern Russia
Udachny Yakutsk Sakhalin RUSSIA Mirny centre Yakutsk centre Krasnoyarsk centre Komsomolsk- on-Amur Tyumen Tomsk Tynda Yuzhno-- Sakhalinsk Boguchany Sovgavan Bogandinskaya CS Irkutsk Skovorodino to the USA Krasnoyarsk centre Khabarovsk Chelyabinsk Proskokovo Omsk Taishet Blagoveshchensk Novosibirsk Kansk Chita Kemerovo Abakan Zabaikalsk Barnaul Angarsk Irkutsk Novokuznetsk Ulan-Ude Gorno-Altaisk Nakhodka Vladivostok KAZAKHSTAN Ulan -Bator Tokyo DPRK MONGOLIA Pyongyang JAPAN KOREA Seoul Beijing
CHINA Gas production centres Pipeline gas Shanghai LNG
17 Operations on the Russian market
356.0 +14.8%
316.3 +3.0% 310.0 307.0
2005 2006 2005 2006 Gas sales volume, bcm Receipts from gas sales, RUR bln
18 Regulated market sector reduction
Increasing the maximum level of changes in regulated gas prices: to 15% in 2007
to 25% in 2008
to 20% in 2009
to 28% in 2010
Introducing a pricing formula in long-term contracts
By 2011 sales profitability on the domestic market is planned to be brought in line with the European level adjusted to transportation costs and charges
19 Electronic trading dynamics
mln m³
221 200 258 254 235 165.9
134 94.5 64 90 91 33.7 73 29 95 25 30 25.1 60 1 24.3 3
11.22. 06 12.15. 06 01.07.07 02.01.07 02.09.07 02.15.07 02.20.07 03.01.07 03.12.07 03.15.07 03.20.07 Independent producers Gazprom Group
The prices at trading sessions exceeded the regulated ones by 30–40% 20 Gasification of Russian regions
The Gasification Program envisages construction of over 12,000 km of gas distribution pipelines between 2005 and 2007
In 2006 122 local pipelines with a total length of 1,313 km were completed
In 2007 the Program will enable to increase the number of gasified apartments and households by 15%
Gas will be additionally delivered to over 13 mln people
In 2006 the Program was funded with RUR 17.6 bln, with RUR 20.2 bln to be invested in 2007
21 Gas export to the CIS and Baltic countries
Switching to market relations with the CIS and Baltic countries
Expanding presence on the CIS and Baltic markets
– acquiring stakes in gas transmission and marketing companies
– establishing joint ventures
Gas sales volume – 101.0 bcm (up 31.9%), Receipts from sales – RUR 209.7 bln (up 93.5%)
22 European market
161.5 +3.5% 845.9 +36.6%
619.1
156.1
2005 2006 2005 2006
Gas sales volume, bcm Receipts from sales, RUR bln
23 Long-term contracts and strategic agreements
Contracts extended with
E.ON Ruhrgas – four contracts extended through 2035 for a total supply volume of up to 20 bcm per year OMV – extensions agreed on till 2027 and new contracts signed for the supply of 6.9 bcm/yr to Austria Eni – extensions till 2035 for the supply of gas to Italy
Gaz de France – extensions till 2031 for the supply of gas to France
RWE Transgas (Czech Republic) – till 2036. Deliveries will grow to 9 bcm starting 2010
Agreements signed on the Main Terms & Conditions of >20 bcm/yr Gas Deliveries through the Nord Stream Gas Pipeline with E.ON Ruhrgas, DONG Energy, Gazprom Marketing & Trading and Gas de France
with BASF and E.ON to swap assets
on the Strategic Partnership with Eni
24 UGS in Europe Agreements concluded
to potentially create a Poederlee (Belgium) underground storage site, Gazprom’s share – 75%
to increase Gazprom’s share to 75% in the Humbly Grove UGS facility
Great Britain Gazprom has obtained the right to tap Jemgum Humbly Grove Hinrichshagen into the Hinrichshagen structure Rehden Poederlee (Germany) for UGS site construction Belgium Bernburg purposes
Gazprom takes UGS capacities on Germany Shonkirchen lease (between 2006 and 2007- 400 mln Haidach m³ of working gas volume in Germany Austria and Austria)
25 Diversification of markets and geography of supply
Strategy to build up presence on the LNG market
Spot deals and LNG-for-pipeline gas swaps
From 2005 Gazprom Marketing & Trading has effectuated LNG spot deliveries to the USA, the Great Britain, South Korea, Japan, India and Mexico. The total sales volume – around 0.6 mln t (0.9 bcm)
In December 2006, Sakhalin Energy’s stockholders and Gazprom signed the Protocol on Gazprom’s entry into the Sakhalin-2 project as a leading stockholder
26 Sakhalin-2
Nyrovo Sakhalin-2 (Piltun-Astokhskoye) Nikolayevsk-on-Amur Okha
Val Lazarev Pogibi Katangli De-Kasti
Sakhalin-2 (Lunskoye)
d n Smirnykh la s I n The project contemplates developing li a h k a the Piltun-Astokhskoye oil (reserves – S Gastello around 600 mln t) and Lunskoye gas (reserves – 700 bcm) fields Dolinsk
Yuzhno-Sakhalinsk
Prigorodnoye
Kril’on
Wakkanai Gas pipeline LNG plant
Oil pipeline Hydrocarbon fields
The project is aimed at LNG supply to Asia-Pacific
27 Exploration and production abroad
Vietnam
Mong Cai CHINA Hanoi Venezuela Halong
Hai Nan
CARRIBEAN SEA Aruba Island (Netherlands) Curacao Island (Holland) GUAJIRA CARDON-III Uzbekistan PENINSULA PARAGUANA Block 112 COLUMBIA PENINSULA URUMACO-I Punto Fijo Dong HA URUMACO-III Bay of La Vela URUMACO-III Gulf of Coro MORUY - III GULF OF VENEZUELA Coro Aral Sea Chimkent India Charvak VIETNAM El Tablazo
Tashkent
Almalyk VENEZUELA BANGLADESH Maracaibo UZBEKISTAN JHARKHAND Kungrad
Nukus WESTERN BENGALIA Nurata Ranchi
Urgench Navoi Buchar Samarkand a
Mubarek
Karshi Calcutta Chardzhou Haldia Termez ORISSA Kelif Block-26 Bhubaneshvar (NEC-OSN-97/1)
Paradip
BAY OF BENGAL
Vishakhapatnam
28 Power industry
Increasing profitability under the Russian power industry restructuring conditions
Achieving synergies with other business activities
Diversifying tariff control risks
Optimizing the share of natural gas in Russia’s fuel balance
Power generation activities abroad
The Agreement with the Armenian Government for ArmRosgazprom joint venture to acquire and complete the construction of the fifth 1,100 MW power generating unit at the Razdanskaya CHP
29 Electric power and СО2 emission quotas trading
May 2006
Gazprom Marketing & Trading joined the Code of Rules governing purchases, sales and transportation of electric power in the Great Britain
October 2006
First electric power trading deal
November 2006
Gazprom Marketing & Trading sealed its first deal to trade in СО2 emission quotas in Europe
30 New products and technologies
Synthetic liquid fuel (SLF) production Intensive development of low pressure gas reserves, associated gas, gas fields located at long distances from gas transportation infrastructure
Coalbed methane extraction Expansion of the hydrocarbon resource base and target markets
Gasification of the Kemerovo Oblast and southern Siberia
31 Debt portfolio management
Growth of Gazprom’s credit ratings confirms its status of a 56.6% reliable borrower
24.6%
14.1%
The share of long-term loans secured by export revenues
12.31.2004 12.31.2005 12.31.2006
32 Investments and capital investments
Capital investments - a total of RUR 410.4 bln (up 43.5%)
Transmission 47.9%
Oil and condensate production 11.3%
Processing 5.1% Other Gas production 8.1% 27.6%
33 Non core asset divestiture
Deals worth RUR 31 bln executed
excluding intra-Group transactions – RUR 9.4 bln
34 Structure improvement
Enhancing performance efficiency
Optimizing business management at the subsidiary level
Setting up specialized subsidiaries on the platform of gas transmission and production companies, and consolidating assets according to a field of action
35 OAOOAO GazpromGazprom ShareholdersShareholders Meeting,Meeting, JuneJune 29,29, 20072007