Russian Gas Transit in Intense Competition and Market Liberalisation in Europe

Alexander Medvedev General Director of Gazexport

Brussels, October 19, 2004

1 Gazprom’sGazprom’s NaturalNatural GasGas ExportsExports byby CountryCountry inin 20032003 ((bcmbcm))

The Netherlands 2.3 Yugoslavia 1.9 Slovenia 0.7 Macedonia 0.1 Romania Austria France Slovakia 5.1 6.0 Czech Rep. 7.3 11.2 Croatia 0.6 7.4 Italy Poland 7.4 19.8 Bosnia 0.2 10.4 2.9 Hungary 12.9 29.6 Bulgaria 5.1 Greece 1.9 Germany Turkey Finland Switzerland 0.3

Total Exports - 133.0 bcm

2 ’sRussia’s GasGas ExportsExports toto WesternWestern EuropeEurope

Gazexport supplied: in 2002 – 87.8 bcm

bcm in 2003 – 94.4 bcm

40 35.0 32.2 2002 35 2003 30

25 19.3 19.7 20

15 12.9 11.4 11.8 11.2 10 6.0 5.2 4.6 5.1 5 1.4 2.3 1.6 1.9 a 0 e y c tri Greece y n s inland rlands u F e y tal ra A n I urke F a T

Germ The Neth

3 Russia’sRussia’s GasGas ExportsExports toto CentralCentral EuropeEurope

Gazexport supplied: in 2002 – 41.6 bcm in 2003 – 44.5 bcm

12 bcm

10.4 2002 10 9.1 2003

8 7.7 7.47.4 7.3 7.4 7.3

6 5.1

4 3.5 2.8 2.9

2 1.7 1.9 1.2 1.2

0 Hungary Czech Rep. Poland Slovakia Romania Bulgaria Yugoslavia Croatia

4 Gazprom’sGazprom’s NaturalNatural GasGas ExportsExports toto EuropeEurope

bcm

140.0 160 133.0 129.0 129.4 123.5 126.8 127.0 116.8 120.5 140 117.4 105.9 120

100

80

60

40

20

0 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 estimated 5 Gazprom’s Share in the European Gas Market

2.2.00 ttccmm

Helsinki 25%25%Oslo GAZPROM purchased 28.4 tcm from Gazprom

London EUROPEBonn only 7.0% sold

Paris 2003 523 bcm Alma-Ata

Madrid >> $$ 220000 bbnn

6 Minimal Russian Natural Gas Export Obligations under Existing Contracts* bcm

180 160 140 120 100 80 60 40 20 0 9 1 8 0 0 7 0 0 2 0 6 0 0 2 5 0 0 2 4 0 0 2 0 0 2 0 2 2

* Not taking into account the possible extension of contracts. 7 RussianRussian GasGas FlowsFlows

Russia

Belarus Netherlands Poland

Ukraine Germany Czech Republic Slovakia France Austria Switzerland Hungary Slovenia Romania Croatia Romania Italy Bosnia & Herzegovina Bulgaria Yugoslavia

Macedonia Turkey Greece

8 W H I T E S E A

я Major Gazprom’sи Export Gas Pipelines г е в р о F I N L A N D Н

N O R T H S E A I R E L A N D R u s s i a

/ Yamal - Europe

U K R С A I N E 80% of export gas is m

SEA OF AZOV a transported via Ukraine re St N ue

Bl C A S P B L A C K S E A S

A Z E R B A I J A N

G R E E C E 9 M

E Gas pipelines in Ukraine

P O L A N D B E L A R U S R U S S I A

L’vov Kiev Drozdovichi

Velke Kapushany S L O V A K I A U K R A I N E

Beregovo H U N G A R Y Medieshu Aurit

Оdesa R O M A N I A Азовское море

Isaccha

10 Gas Pipelines in Slovakia

11 Gas Pipelines in the Czech Republic

12

Nørresundby

E

P N I

P Vastervik Älborg Staraya Rus O

R Va r be rg

U

E Slite Oskarshamn Ve n t s p il s Studstrup Halmstad DENMARK YamalYamal –– EuropeEurope GasGas PipelinePipelineInchukaln Izborsk Arhus Kærgård Kalmar Jurmala Fredericia Helsingborg RI GA Esbjerg Karlshamn PSKOV Kalundborg COPENH AGEN Ronneby Liepaja Karlskrona Odense Solvesborg Rezekne RUSSIA Malmö Akmene Mazeikiai Trelleborg Klaipeda Daugavpils Panevezys Heide Dornum Polotsk (Russian Fed.) Vitebs k Lübeck en WilhelmshavenBremen Kaliningrad Gdansk Gdynia RUSSIA Elblag Alitus Schwedt Szczecin VI LNIUS Olsztyn Hannover Mogilev

Grodno BERLI N Torun AL ED /Oder Nesvizh W Osipovich Wloclawek E RMANY Poznan Plock Kondratki Zielona Solegorsk Gora W Leipzig ARSAW Kobrin Ivacevichi Gom Odolanov ST Dresden Rechitsa urt/ EG Lodz Schlüchtern AL Brest Zwickau StrazkyLiberec Sayda Wroclaw Mozyr Litvinov Kralupy Würzburg PRAGUE L A Wal brzychGlinsk Mariampolski AG Lublin J Compressor stations Chern Pardubice Kielce Olishevka Wai dhaus Plzen Trzebinia Kostopol KIEV Nürnburg Korosten CZECH Lutsk Ostrava Katowice Krakow CompressorRovno stations gart REPUBLIC Czechowice Neustadt Olomouc Borisp Kamenny Brod Zhitomir Ingolstadt Brno underBrody construction Hermanowice Jaslo Lvov Zilina Nowy Sac z VI ENNA Przemys BRATISLAVA Lanzhot Ber ghausen SL OVAK Belaya Tserkov Munich Khmelnik REPUBLIC Ternopol Kosice Zvolen Vinnitsa Dolina Ivano-Frankovsk Salzburg Velke Nadvornaya UKRA Baumg arten Kapuzan y ludenz Levice Uzhgorod Kamenets-Podolskiy 13 Gas Pipelines in Romania

14 Gas Pipelines in Bulgaria

15 Blue Stream Gas Pipeline

16 я и ги е в р о Н F I N L A N D

я и Northern European Gasц PipelineФИНЛЯНДИЯ Northern European Gasе Pipeline в

Ш

Vyborg

a Estonia e S S c N O R T H S E A iic lltt a B Denmark R U S S I A Latvia

UK Lithuania Bacton

NETHERLANDS

BELGIUM

G E R M A N Y P O L A N D Belarus MainMain characteristics characteristics of of Vyborg Vyborg - - Greifswald Greifswald section section LUX (one(one line): line):

Czechcapacitycapacity Republic - - 19.2 19.2 bcm/ bcm/ year year lengthlength - - 1189 1189 km km France diameterdiameter - - 42” 42” pressurepressureSlovak Republic - - 22 22 MPa MPa

Switzerland U K R A I N Austria

Венгрия М о 17 л д я и ц е в

Ш InterconnectorInterconnector

Эстония

е р о м е о к с й NORTH SEA и т л I R E L A N D а Б

Латвия

U N I T E D K I N G D O M

Bacton Литва

NETHERLANDS INTERCONNECTOR Zeebrugge

BELGIUM

GERMANY P O L A N D Б Е Л О Р

LUX FRANCE

ЧЕХИЯ 18