On signing Memorandum with regard to additional gas supplies to GDF SUEZ and Nord Stream project
March 1, 2010 - Today in Paris and in the presence of President of Russia Dmitry Medvedev and President of France Nicolas Sarkozy Gazprom Management Committee Chairman Alexey Miller and GDF SUEZ Chairman and Chief Executive Officer Gérard Mestrallet signed a Memorandum on additional supplies of Russian natural gas and on the entry of GDF SUEZ into the Nord Stream project.
The document specifies that the parties have started discussions about supplying to GDF SUEZ up to 1.5 billion cubic meters of additional gas per year from 2015. The supplies will be fulfilled via the Nord Stream.
Alexey Miller and Gérard Mestrallet also expressed their satisfaction with the progress made to finalize the deal under which GDF SUEZ will become a shareholder of Nord Stream AG with a share of 9 per cent in its capital before the start of the gas pipeline construction.
"The Nord Stream is a strategically important pipeline for Europe. The value of the project is difficult to overestimate, as it will be an additional guarantor of energy security for millions of consumers and give them confidence in the future. The Nord Stream is a good example of an offshore gas pipeline complying with stringent international environmental requirements. It has recently received the last approval needed to begin construction this April. Together with our counterparts from GDF SUEZ, we believe that the Nord Stream will not merely strengthen cooperation between our companies, but will also help develop the energy sector of the entire continent and be another factor in the success of the long-term Russian-French partnership in the gas industry," said Alexey Miller.
"In the framework of Cross Year 2010, the year of Russia in France and of France in Russia, the agreement with Gazprom, our long-term Russian partner and the largest gas producer in the world, illustrates the high-quality relationship developed over the years. Furthermore, GDF SUEZ regards with high consideration this major industrial partnership with Gazprom. By entering Nord Stream AG and increasing its gas purchase from Russia, GDF SUEZ aims at contributing to Europe's security of supply including North West Europe where the Group is one the major power producers and holds a large portfolio of final power and gas customers," declared Gérard Mestrallet.
The Nord Stream is a fundamentally new route for Russian gas export to Europe. Going through the waters of the Baltic Sea from the Portovaya Bay (near Vyborg) to the German coast (near Greifswald) the gas pipeline will stretch for approximately 1,200 kilometers. The first Nord Stream string with a capacity of 27.5 billion cubic meters per year is projected to be commissioned in 2011. The construction of the second string of the gas pipeline will allow increasing gas capacity to 55 billion cubic meters.
The Nord Stream project is being implemented by the joint venture Nord Stream AG, set up for the planning, construction and further operation of the offshore gas pipeline. Stakes in Nord Stream AG are currently distributed as follows: Gazprom holds 51 per cent, Wintershall Holding and E.ON Ruhrgas hold 20 per cent each, and Gasunie holds 9 per cent.
The cooperation in the gas supply sector between Gazprom and GDF SUEZ started in September 1975. In total, more than 300 billion cubic meters of natural gas has been supplied to GDF SUEZ.
In December 2006 Gazprom and GDF SUEZ signed an agreement on the renewal of their natural gas supply contracts until 2030. The parties also agreed on additional gas supplies of 2.5 billion cubic meters per year to GDF SUEZ to be shipped mainly via the Nord Stream gas pipeline.
From October 2007 Gazprom got an opportunity to supply up to 1.5 billion cubic meters of Russian gas per year directly to French end consumers.
One of the leading energy providers in the world, GDF SUEZ is active across the entire energy value chain, in electricity and natural gas, upstream to downstream. It develops its businesses (energy, energy services and environment) around a responsible-growth model to take up the great challenges: responding to energy needs, ensuring the security of supply, fighting against climate change and maximizing the use of resources. GDF SUEZ relies on diversified supply sources as well as flexible and high-performance power generation in order to provide innovative energy solutions to individuals, cities and businesses. The Group employs 200,000 people worldwide and achieved revenues of EUR 83.1 billion in 2008. GDF SUEZ is listed on the Brussels, Luxembourg and Paris stock exchanges and is represented in the main international indices: CAC 40, BEL 20, DJ Stoxx 50, DJ Euro Stoxx 50, Euronext 100, FTSE Eurotop 100, MSCI Europe and ASPI Eurozone.
Gazprom is one of the largest energy companies worldwide. Its major business lines are geological exploration, production, transportation, storage, processing and marketing of hydrocarbons as well as generation and marketing of heat and electric power.
Gazprom's richest resources of natural gas account for 17 per cent and about 70 per cent of the world's and Russian gas reserves, respectively. Gazprom produces about 17 per cent of the world's natural gas; the company's share in the Russian gas production market is above 80 per cent.