Gaz de France and Gazprom are extending their existing natural gas supply contracts, currently representing a total of approximately 12 billion cubic meters per year, until 2030. From the end of 2010, Gaz de France will receive additional volumes of 2.5 billion cubic meters of natural gas per year, which will be carried though the Nord Stream.
Furthermore, Gazprom intends to supply Russian gas directly to end customers as of July 1, 2007. These volumes could amount to a total of 1.5 billion cubic meters per year.
Both companies have also agreed to increase their ongoing cooperation related to supplying liquefied natural gas (LNG), training and environmental protection.
Jean-Francois Cirelli, Chairman and CEO of Gaz de France, made the following statement:
"More than thirty years after Gaz de France first purchased Russian natural gas, I am delighted to sign these new agreements with Gazprom, one of Europe's major suppliers of natural gas. They confirm the strength of the long-term partnership between Gazprom and Gaz de France. The extension of our commercial cooperation with Gazprom helps to ensure the long-term reliability of our customers' supply in France and in Europe."
Alexei Miller, Chairman of Gazprom's Management Committee, also said:
"The contracts we have signed today represent a new step in the development of a long-standing partnership between Russia and France. It is a fine example of the success of Gazprom's strategy which aims to supply downstream customers in Europe and to improve the efficiency of Russian gas exports."
Gaz de France boasts the most highly diversified long-term supply portfolio in Europe, with Norway (30%), Russia (23%), Algeria (18%), the Netherlands (17%) in addition to the United Kingdom, Egypt, Libya and Nigeria. LNG represented 24% of this portfolio in 2005. Europe's largest distributor of natural gas, Gaz de France employs more than 53,000 people and recorded net sales of €22.4 billion and net income (Group share) of €1.7 billion in 2005. The Group serves 13.8 million customers, including 11.1 million in France.
Cooperation between OAO Gazprom and Gaz de France in the area of gas supplies began in September 1975. Since then, Gazprom has supplied France with more than 272 billion cu.m, including 13.1 billion in 2005 and 8 billion for the first 10 months of 2006.
On June 28, 2003, Gazprom and Gaz de France signed an agreement to develop their cooperation whereby the supply of gas would be complemented by other forms of cooperation with, in particular, greater energy efficiency, the renovation of transmission infrastructures, the reduction of gas leakage, the construction and development of underground storage facilities, LNG and training.
On September 19, 2005, Gazprom and Gaz de France signed an agreement to continue their cooperation.
On November 23, 2005, Gazprom and Gaz de France signed their first swap agreement for the supply of LNG. A shipment of LNG was sold to Shell Western LNG at the Cove Point regasification terminal (State of Maryland) in December 2005.
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