OAO Gazprom, Russia
Dec 2 2013

MOSCOW, Russia

The command to start up the power unit was given by Russian President
Vladimir Putin and Armenian President Serzh Sargsyan via video link
from Gyumri.

The fifth power unit at the Hrazdan TPP will make it possible to meet
the growing power demand in Armenia and neighboring countries.

Alexey Miller and ArmRosGazprom Director General Vardan Arutyunyan,
in the presence of both Presidents, signed a contract for Russian
gas supply to Armenia from 2014 to 2018. According to the document,
Gazprom will annually provide Armenia with 2.5 billion cubic meters
of gas and its price will be determined by a price formula linked to
the pricing mechanism for natural gas in Russia.

Russian Energy Minister Alexander Novak and Armenian Energy and Natural
Resources Minister Armen Movsisyan signed an intergovernmental Sales
and Purchase Agreement for ArmRosgazprom's shares and the company's
future activities. After the deal is complete, Gazprom's stake in
ArmRosgazprom will increase from 80 per cent to 100 per cent.

"Our strategic cooperation with Armenia is a vivid example of how
it's possible to effectively build up the long-term and mutually
beneficial partnership. Our direct engagement in the Armenian power
market, meaning the whole value chain, gives some undoubted advantages
to the Republic. This includes adequate supplies of natural gas at
a fair price, investment in modern power generating capacities,
development of the power generation sector and creation of new
jobs. I am confident that our successful cooperation will be on a
strong track," said Alexey Miller.


The fifth power generating unit (480 MW) at the Hrazdan TPP is
equipped with state-of-the-art gas turbines. The fifth power unit
produced 1.9 billion kW of electricity during its pilot production
period from January 2012.

Armenia does not produce natural gas and the country's power generation
sector is totally reliant on gas imports. Gazprom Export delivers gas
to the border with Armenia where it is purchased by ArmRosgazprom. In
2012 Gazprom delivered 1.7 billion cubic meters of natural gas
to Armenia.

Incorporated in December 1997, ArmRosgazprom is focused on natural gas
supplies to the Armenian market. In addition, the company transports,
stores, distributes and sells natural gas as well as upgrades and
expands gas transmission and underground gas storage systems in the
Republic of Armenia.

In March 2006 Gazprom and the Government of the Republic of Armenia
signed a 25-year Agreement identifying the strategic principles of
Gazprom's participation in gas and power projects in the Republic of
Armenia. The document provides for an increase of Gazprom's ownership
stake in ArmRosgazprom via an additional share issue. As a result,
Gazprom acquired an 80 per cent stake in ArmRosgazprom. The funds
received from the share issue were allocated for purchasing and
constructing the fifth power unit at the Hrazdan Thermal Power Plant
as well as gas infrastructure facilities in Armenia.