Open Joint Stock Company Gazprom

OAO GAZPROMPrivatisation and FormationGazprom was reorganised into a joint stock company in 1993 in accordance with the PresidentialDecree No. 1333 of 5 November 1992 ("Decree No. 1333"). Under Decree No. 1333, Gazprom wasmade responsible for ensuring the efficient operation and development of the UGSS. The UGSS hadpreviously been the responsibility of the State Gas Concern "Gazprom", the State controlled entitycharged with the task of operating and developing the UGSS prior to the 1993 reorganisation. Pursuantto Decree No. 1333 and Presidential Decree of the Russian Federation No. 2116 of 6 December 1993,Gazprom was charged with the responsibility of providing for natural gas export deliveries throughGazexport, its wholly-owned specialised foreign trade subsidiary, which became part of the State GasConcern "Gazprom" in 1991 and was also appointed "state contractor" for natural gas exports.Decree No. 1333 charged Gazprom with the following Principal tasks:• ensuring a reliable supply of natural gas to consumers in Russia and to foreign customers;• conducting a co-ordinated policy for maintaining and further developing the UGSS;• controlling the operation of the UGSS;• financing and constructing natural gas pipelines and high pressure outlets so as to serviceareas of Russia where natural gas was previously unavailable; and• providing access for any independent producer of natural gas to the transportation systemin proportion to the amount of natural gas produced by such independent producer inRussia.The original Charter of Gazprom was approved by Order No. 138 of the Council of Ministers ofthe Russian Federation issued on 17 February 1993 and Gazprom was registered as an open jointstock company on 25 February 1993. In 1993 and 1994 licences were issued to Gazprom, pursuant tothe Subsoil Resources Law 1992, granting Gazprom rights to exploit hydrocarbon reserves.Decree No. 1333 provided for the transfer to Gazprom of 100% of the share capital of enterprisescomprising the UGSS, controlling equity stakes (not less than 51%) in a number of other entitiesreorganised into joint stock companies, the interests of the State Gas Concern "Gazprom" in Russianand foreign enterprises and other assets of the State Gas Concern "Gazprom", the privatisation ofwhich was not restricted. Decree No. 1333 also provided for all rights and obligations of the State GasConcern "Gazprom" to inure to Gazprom's benefit, including its rights to use underground deposits andnatural resources, as well as its rights and obligations under the State Gas Concern "Gazprom's"contracts. Gas producing enterprises Yakutgazprom and Norilskgazprom, which used to be part of theState Gas Concern "Gazprom", were reorganised into separate and independent joint stock companies.Decree No. 1333, Directive No. 58-rp of the President of the Russian Federation dated 26January 1993, Gazprom's privatisation plan and certain other legislative acts issued by the Presidentand the Government provided for:• 15.0% of Gazprom Shares to be sold by closed subscription to employees and themanagement of the enterprises comprising the UGSS (which had been transferred toGazprom);• 33.9% of Gazprom Shares to be sold to Russian individuals in return for privatisationvouchers (of which 0.87% have not been sold and remain within Federal ownership);• 40.0% of Gazprom Shares were fixed for three years within Federal ownership;• 1.1% of Gazprom Shares to be transferred to joint stock company "Rosgazifikatsiya" (asupplier of natural gas to end-consumers); and20