Open Joint Stock Company Gazprom

To fund the project Gazprom and Blue Stream Pipeline Company B.V. entered into agreementswith a syndicate of Western European and Japanese banks to raise loans to finance the Blue StreamProject. The total amount available to Gazprom and Blue Stream Pipeline Company B.V. for the BlueStream project is U.S.$1.76 billion. Of this amount Gazprom is able to borrow U.S.$573 million(U.S.$490 million had been drawn by Gazprom as at 10 September 2002) and Blue Stream PipelineCompany B.V. is able to borrow the balance of U.S.$1.187 billion. As at 10 September 2002 Blue StreamPipeline Company B.V. had drawn U.S.$184 million of the credit facility, of which U.S.$114 million hasbeen guaranteed by Gazprom. The remainder of the financing for the Offshore Section of the BlueStream Project is covered by the various equity contributions of the sponsors of the project, Gazpromand SNAM (ENI's subsidiary) and a U.S.$866 million loan to Blue Stream Pipeline Company B.V. withthe guarantee of SNAM. The outstanding financing required for the Onshore Section of the Blue StreamProject is to be provided by Gazprom from its own funds and through other debt financing. For example,in February 2001, Gazprom received a loan for these purposes of euro 250 million from a consortiumof international banks led by Bayerische Hypound Vereins Bank. The loans received by Gazprom toimplement this project are issued on a secured basis.ShellOn 17 November 1997, Gazprom signed a strategic alliance agreement with Shell, whichcontemplated the parties' joint co-operation on several projects. So far, the parties are in the process ofnegotiating the draft joint venture agreement, coordinating projects for Shell's participation in theextension of the gas transportation system, and negotiating the terms of financing and implementationof the production sharing agreement. In accordance with the strategic alliance agreement, Shellproposed to create an international consortium to oversee investment in the Ukraine's gas transitsystem, the main objective of which would be to organise proper management and control over thatsystem. The parties are presently continuing consultations in respect of the above issues.Petro ChinaOn 4 July 2002 Gazprom, Royal Dutch/Shell and ExxonMobil, acting as a consortium, signed aframework agreement with Petro China on the creation of a joint venture on the West-East pipelineproject in China. The project envisages the production of natural gas in the Sintszyan-Uigur region inChina, the construction of a pipeline of approximately 4,000km in length to Shanghai and the sale ofgas in the eastern Chinese market. The parties are in the process of negotiating the terms of the jointventure on the construction and operating of the pipeline as well as on the conclusion of gas productionsharing agreements and on the establishment of a Unified Trading Company responsible for gas salesto consumers. All negotiations are planned to be completed by the end of 2002.BASFGazprom is supplying an increasing proportion of natural gas to the Western and Central andEastern European markets via transportation and marketing companies in which it has equity interests.In Germany, Gazprom and BASF agreed to undertake joint marketing of natural gas and to buildand operate gas pipelines and supply networks in 1990. This agreement led to the construction of theSTEGAL gas pipeline which, with a total length of 313 km, connects the MIDAL gas pipeline with theCzech natural gas pipeline system.Gazexport, through its German subsidiary, Zarubezhgaz Erdgashandel ("ZGG"), owns a 35%share-holding in Wingas. Wingas in turn owns the MIDAL-STEGAL pipeline system and a natural gasstorage facility at Rehden with a current utilised capacity of 4.2 bcm. The total amount invested into theMIDAL-STEGAL pipeline system and the gas storage facility at Rehden amounts to approximately DM4 billion, including Gazprom's contribution of DM 1.4 billion.Gazexport and Wintershall each have a 50% shareholding in the gas trading companyWintershall Erdgas Handelshaus ("WIEH"). WIEH purchases its natural gas supplies exclusively fromGazprom under long-term contracts. Two long-term natural gas supply contracts have been concludedwith WIEH for a total annual volume of 13.8 bcm. Sales by WIEH are to Wingas, Verbundnetzgas, a51