all you need is gas · 2010 2020 2030 0% 20% 40% 60% 80% 100% 2010 2020 2030 diversification of gas...

0

ALL YOU NEED IS GAS

Gazprom Investor Day

2011

11

Disclaimer

This presentation has been prepared by OJSC Gazprom (the “Company”), and comprises the slides for a presentation to investors concerning the Company. This presentation does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares or other securities representing shares in the Company, nor shall it or any part of it nor the fact of its presentation or distribution form the basis of, or be relied on in connection with, any contract or investment decision.

No reliance may be placed for any purposes whatsoever on the information contained in this presentation, or any other material discussed at any presentation or on its completeness, accuracy or fairness. The information in this presentation should not be treated as giving investment advice. Care has been taken to ensure that the facts stated in this presentation are accurate, and that the opinions expressed are fair and reasonable. However, the contents of this presentation have not been verified by the Company. Accordingly, no representation or warranty, express or implied, is made or given by or on behalf of the Company or any of its members, directors, officers or employees or any other person as to the accuracy, completeness or fairness of the information or opinions contained in or discussed at this presentation. None of the Company or any of their respective members, directors, officers or employees nor any other person accepts any liability whatsoever for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection therewith.

The information in this presentation includes forward-looking statements. These forward-looking statements include all matters that are not historical facts, statements regarding the Company’s intentions, beliefs or current expectations concerning, among other things, the Company’s results of operations, financial condition, liquidity, prospects, growth, strategies, and the industry in which the Company operates. By their nature, forward-looking statements involve risks and uncertainties, including, without limitation, the risks and uncertainties to be set forth in the prospectus, because they relate to events and depend on circumstances that may or may not occur in the future. The Company cautions you that forward looking statements are not guarantees of future performance and that its actual results of operations, financial condition and liquidity and the development of the industry in which the Company operates may differ materially from those made in or suggested by the forward-looking statements contained in this presentation. In addition, even if the Company’s results of operations, financial condition and liquidity and the development of the industry in which the Company operates are consistent with the forward-looking statements contained in this presentation, those results or developments may not be indicative of results or developments in future periods.

The information and opinions contained in this presentation are provided as at the date of this presentation and are subject to change without notice. No person is under any obligation to update or keep current the information contained herein.

By attending the presentation you agree to be bound by the foregoing limitations.

2

Agenda

ExportAlexander Medvedev

Deputy Chairman of Gazprom Management CommitteeDirector General of Gazprom Export

Strategy

Finance

Vlada RusakovaMember of Gazprom Management CommitteeHead of Strategic Development Department

Andrey KruglovDeputy Chairman of Gazprom Management CommitteeHead of the Department for Finance and Economics

Gazprom Neft

Gazprom Energoholding

Denis FedorovHead of Gazprom Directorate for Development of Power Generation Sector

and Power Generation Marketing, General Director of Gazprom Energoholding

Vadim YakovlevFirst Deputy Chairman of the Management Board of Gazprom Neft

CFO of Gazprom Neft

2

Investor Day 2011 3

Strategy

Part 1. Vlada Rusakova

Strategy - Investor Day 2011 4

Natural gas – the future of world energy

Ecology «–»

Costs «–»

Security of Supply «+»

Reserves «–»

Ecology «+»

Costs «+»


Reserves «+»

Ecology «–»

Costs «+»


Reserves «+»

TODAY TOMORROWNatural Gas

Coal NuclearOil

ALL YOU NEED IS GAS

RenewablesEcology «–»

Costs «+»


Reserves «–»

Ecology «+»

Costs «–»

Security of Supply «–»

Reserves «+»


Gas demand 2030

Share of gas in world energy consumption

Gas consumption by region, tcm

2009

2030

21%

26%

– Natural Gas

– Other

– Asia/ Oceania

– Latin America

– Europe(1)

– FSU(2)

– Africa

– Middle East

– North America

5.1 tcm

2009 2030

3 tcm

1.1

1.1

0.9

0.8

0.7

0.30.2

Source: Gazprom estimatesNote: Cubic meter – 9,086 kcal, 20°C1.Including Baltic States2.Excluding Baltic States


0

150

300

450

600

750

2009 2020 2030

0

150

300

450

600

750

2009 2020 2030

0

150

300

450

600

750

2009 2020 2030

Export markets development

Europe(1), bcm Northeast Asia, bcm

– Import,for FSU including internal trade movements

– Domestic production,for FSU countries domestic production for own consumption

270

380400 500

80 90

FSU(2), bcm

Source: Gazprom estimates;Note: cubic meter – 9,086 kcal, 20°C1.Including Baltic States2.Excluding Russia and Baltic States


NE ASIA

LNG

EUROPE

LNG

Gazprom on export markets in 2030

OTHERMARKETS

WORLD LNG

TRADE

PIPELINE

33%

FSU(1)

32%

LNG

13%

14%(2)

Source: Gazprom estimates1.Excl. Russia and Baltic States2.Incl. shares in associated companies


0

1000

2000

3000

4000

5000

6000

2010 2011 2012 2013 2014 2015

0

100

200

300

400

500

600

700

этап I этап II этап III

Russian gas market

Increasing Russian gas prices to achieveexport netback parity, RR

2,871

Market Price

+15%

+15%

+15%

Energy Intensity of GDP(1)

Note: cubic meter – 9,086 kcal, 20°C1.Energy Strategy of Russian Federation until 2030

2008 2030

85% 43%

to level of 2005

Gas price forindustrial consumersin Russia

Gas Consumption(1), bcm

560 640

2008-2013/15 2013/15-2020/22 2020/22-2030

2,495

+15%


0%

20%

40%

60%

80%

100%

2010 2020 2030

0%

20%

40%

60%

80%

100%

2010 2020 2030

Diversification of gas sales

Structure of Gazprom Group's gas sales

Structure of revenues fromGazprom Group's gas sales

– LNG(1)

– Europe incl. Baltic States

– Russia

– North-East Asia

– FSU Countries(excl. Russia and Baltic States)

52% 37% 34%

VOLUMES REVENUE

1. Incl. shares in associated companies


Gazprom’s gas reserves

Shelf

Northwestern FD

Privolzhsky FD

Southern and North Caucasian FD

Siberian FD

285

90

7592,561

FD – Federal District1.Categories ABC1 as of 31.12.2009

Shtokman:3.8 tcm of gas

Yamal:8.5 tcm of gas

Urals FD Far East FD

5,091

24,391

402

103,00073,800

2,700

11,500

5,100

14,600

37,900

– Russian Gas Resources– Gazprom’s Reserves(1)

bcm


Shtokman

Prospective sources of Gazprom’s gas production

Eastern Siberia and Far East

New fields inNadym-Pur-Taz

bcm

Yamal

– Currently existing projects

– New fields in Nadym-Pur-Taz

– Yamal Megaproject

– Shtokman Project

– Eastern Siberia and Far East

Note: cubic meter – 9,086 kcal, 20°C

0

100

200

300

2010 2020 2030

0

100

200

300

2010 2020 2030

0

100

200

300

2010 2020 2030

0

100

200

300

2010 2020 2030

0

200

400

600

800

2010 2020 2030

bcm


0

50

100

150

200

250

300

350

2012 2015 2020 2025 2030

Reserves Resources

Gas, tcm 11.7 38.8

incl. shelf 1.3 28.5

Condensate, mln t. 231 3,025

incl. shelf 7 2,383

Oil, mln t. 292 3,852

incl. shelf n/a 3,054

Bovanenkovskoye 4.9

Kruzenshternskoye 1.7

Kharasaveyskoye 1.6

– Leningradskoe

– Tambey group(1)

– Kruzenshternskoye

– Kharasaveyskoy

– Bovanenkovskoye

Gas production, bcm

Note: cubic meter – 9,086 kcal, 20°C1.Excluding Yuzhno-Tambeyskoye field2.Gazprom Group holds the development licenses for the Bovanenkovskoye, Kharasaveyskoye, Novoportovskoye, Kruzenshternskoye, Severo-Tambeyskoye, Zapadno-Tambeyskoye, Tasiyskoye and Malyginskoye fields

Reserves and resources of Yamal peninsula

Gazprom’s giant gas fields(2), tcm

Yamal reserves & resources


Yamal transportation facilities development

Bovanenkovskoye field (Cenomanian & Aptian Deposits)

Reserves (categories АВС1+C2) bcm 4.9

Projected natural gas production bcm 115

Comprehensive gas processing units units / bcm 3 / 120

Booster compressor station units / MW 9 / 1,492

Bovanenkovo-Ukhta Trunk Gas Pipelines

Capacity bcm p.a. 113.3

Diameter (2 lines) mm 1,400 (x2)

Length km 1,109.6

Working Pressure MPa 11.8

Ukhta-Torzhok Trunk Gas Pipelines

Capacity (different parts) bcm p.a. 55.8 – 90.0

Diameter (2 lines) mm 1,400 (x2)

Length km 1,371

Working Pressure MPa 9.8


Gas CAPEX 2011-2030

EXPLORATION

PRODUCTION

TRANSPORT

(incl. UGS)

PROCESSING

OTHER

47%

31%

6%

8%

8%

Structure of CAPEX by business segment (average annual)

Structure of CAPEX by major project(2011-2030 in total)

700-900 bln RR p.a.

– Reconstruction in Transport

– Shtokman Project

– Eastern Siberia and Far East

– Yamal Megaproject

– Reconstruction in Production

– Transport System Development(incl. UGS)

– Other projects within UGSS (exploration; new production and drilling (excl. Yamal and Shtokman); processing; others)

14%

29%

8%8%

15%

6%

20%

Investor Day 2011

Part 2. Alexander Medvedev

Export

15

Export - Investor Day 2011 16

European gas market outlook

European gas consumption and imports in 2009

Source: International Energy Agency, Eurostat, Gazprom Export. Russian standard gas

Sources: BMWi, Bloomberg, European Central Bank

Source: Bloomberg

Source: 10 Leading International forecast makers

2009 2010E 2010/09, bcm 2010/09, %

Consumption (bcm) 565.2 604.6 39.4 7.0%

Indigenous production (bcm)

307.0 311.0 4.0 1.3%

Imports and stock change (bcm)

258.2 293.6 35.4 13.7%

Supply–indigenous production gap:380 bcm pa by 2020435 bcm pa by 2030

European demand for imported gas, bcm

Industrial Production Recovery in Europe, MOM, %

Convergence of Spot and Long-Term Contract Prices, US$/mcm


Gazprom’s sales to European and FSU markets

Gazprom Group gas deliveries to Europe Average FSU price growth

Gazprom’s forecasted European market share Gazprom’s long-term contracts portfolio to Europe

$/mcm

156 162 169 168153 153E

165E

bcm $/mcm

2010 2020 2030

Gazprom’s long-term contracts portfolio ensures the sale of more than 4 trillion cm of gas to

Europe over 2011-2030 (incl. new volumes for North Stream and South Stream projects)

Source: Gazprom estimates

bcm


Spot vs. long-term oil-indexed contracts

Share of gas-indexed prices in Gazprom’s sales portfolio, 2010

Gas supply mix in the UK and Continental Europe, 2009

Churn ratio(1), European gas hubs Resales dominate Continental hubs’ trade, 2009, bcm

2008 2009 2010E

NBP 14.5 14.4 16.3

Zeebrugge 5 5 4.6

TTF 3 3.2 3.4

PSV 2.1 2 -

PEG 1.2 - -

GASPOOL (BEB) 2.2 - -

CEGH 3 2.9 3.1

NCG (EGT before 2009) 2.1 1.8 2.4

Sources: CERA ,Gazprom estimates

UK Continental Europe

1. The ratio of traded volumes to physical gas deliveries after trades


Gas as the most cost-efficient pathway to reach CO2 reduction targets in the EU

Total investments in renewable energy sources should be €1550 billion, including €820 billion of Government subsidies over 2011-2030 in order to meet EU CO2 reduction targets

Source: McKinsey for the European Gas Advocacy Forum

€820 billion –Governmentsubsidies

€1550 billion –total investments

Source: Pace Global

2030 2050

Gas-optimizedscenario

Renewables 60%

700 1,650

1,200 2,500

850

capitalexpenditures

350-400

operationalexpenditures

450-500total

savings

Cumulative cost advantage of gas-optimized scenario, € bln

Two scenarios to reach CO2 emissions reduction targets In 2030 and 2050

CURRENT GAS-OPTIMIZED RENEWABLES 60% GAS-OPTIMIZED RENEWABLES 60%


Diversification for further growth: pipeline and LNG projects

New import markets for LNG 5

Traditional Gazprom’s export markets

Bangladesh

Индия

Malaysia

Philippines

Indonesia

Singapore

Vietnam

Thailand

Bahrain

Dubai

Morocco Cyprus

Lebanon

Panama

Dominican Republic

Jamaica

Puerto Rico

Brazil

Argentina

ChileUruguay

52

55

6330 38

25

Shtokman

Eastern routeWestern route

North Stream

South Stream

LNG projects in third

countries

Kuwait

S. Arabia

Spain

Pipeline projects

LNG projects

Maximum export volume for each project

1. Gazprom contract from Sakhalin-2 (1.35 bcm) and new potential production in the Far East

8(1)


Progress with 68 bcm contract with China

June 2009Intergovernmental Memorandum

September 2010Enhanced HoA

June 2011ESales and Purchase Agreement

2015EStart of

deliveries:Western route –

30 bcm

March 200668 bcm

deliveries agreed

December 2009Basic HoA

� Rapid demand growth, more than 400 bcm by 2030

� More than 40 bcm of LNG contracted� Central Asian pipeline deliveries contracted

(up to 40 bcm)� Myanmar gas contracted

� Russian gas is the only long-term supply decision for China


LNG as a tool for export growth

Geographic diversification, access to new and remote markets in the USA, south-west Europe, Asia-

Pacific, Africa and Middle East

No transit country risks with strong control over transportation to the final customers

Diversification opportunities due to the significant change of the market situation or for arbitrage margin

Cost of production(1), US$/mmbtu LNG Build up in Gazprom’s portfolio, bcm

1. Projects at the same phase, before FID adjusted to standartized IRR.


Decisions made for growth

Gazprom’s Board of Directors decision, 23 November 2010:

▪ To strengthen Gazprom’s position in Europe and other export markets by improving the competitive

position of Russian gas

▪ Proceed with geographic diversification entering new markets including pipeline gas supplies

to Asia-Pacific

▪ Enlarge LNG share in Gazprom’s portfolio, incl.:

▪ Guarantee timely Shtokman LNG project start-up (no later than 2017)

▪ Expand Gazprom’s LNG production in Russian Far East (no later than 2017)

▪ Make careful selection of LNG projects outside Russia for Gazprom’s potential offtake

and participation

Investor Day 2011 24

Finance

Part 3. Andrey Kruglov

Finance - Investor Day 2011 25

2010 in review

Gazprom has shown growth of production and sales, as well as improved financial results

Macroeconomic factors

Lower inflation, ruble appreciation,Growth of regulated domestic gas prices

Growth of the Russian GDP and industrial output

Recovery of the European gas demand

Growth of oil prices

Rebound of the global economy

Responsive risk management

Internal measures

Strong free cash flow generation

Decrease in debt

Balanced investment program

Effective cost control


Operational & financial outlook

Strong potential for further growth of results

1. Gazprom Neft’s figures (including equity investees)2. Including TGC-1 production

Strong financial results

2009 2010 E 2011 E 2012E 2013E

Natural gas, bcm 461. 5 508.6 505.6 531.4 558.3

Crude oil(1), mln t 47.6 49.7 49.6 48.9 47.5

Electric power generation, bln kWh 164.6(2) 174.6 174.8 179.9 185.6

Heat output, mln Gcal 96.7(2) 103.0 98.4 98.7 99.0

9M 2009 9M 2010 2009

Net gas sales revenue, RR bln 1, 377 1, 500 1, 916

Total sales revenue, RR bln 2, 155 2,508 2, 991

Adj. EBITDA, RR bln 752 950 1, 090

Adj. EBITDA margin 35% 38% 36%

Recovery of Gazprom Group’s production

9M 2009 9M 2010 2009

Net Debt, RR bln 1, 469 0, 972 1, 372

Total debt, RR bln 1, 762 1, 291 1, 626

T. Debt / Adj. EBITDA 1.69 x 1.00x 1.49 x

Free cash flow, RR bln 30 370 102


Domestic gas transportation tariff growth, RR Average domestic price growth(2), RR/mcm

Key gas market liberalization effect on revenue

1. Except Armenia2. For industrial consumers – market price is expected after 2015; for households – prices will remain regulated. Starting from 2009 price changes are given pursuant to “General assumptions and forecast of social and

economic development in Russia for 2010 to 2012” designed by the Russian Ministry of Economic Development in June 20103. Real price increases were introduced by 5% from Jan 1st and by 15% from Apr 1st in 2010. Price increases by 5% from Jan 1st and by 9.5% from Apr 1st are planned in 2011

Sources of additional revenue

� Growth of FSU prices: market principles in gas pricing with FSU countries implemented from 2011(1)

� Increase in domestic prices: liberalization of the Russian market is expected by 2015(2)

� Increase in gas transportation tariff: regulated domestic gas transportation tariff is expected to reach RR74.6 in 2014

Source: Gazprom estimates

Market liberalization leads to increased revenue for Gazprom

+18% +21% +22%+15.7%

+22.9%+9.3%

c. +33%

+15%+15%

+15%

+26%+15%+11% +19%+15%

+15%+25%+15%+16%+27%

+17%

+27%+16%


Cost optimization program 2010-2013

Manageable cost lines

Sales growth rate is higher than OpEx growth rate

Cost management

� Purchased gas and oil – renegotiation of contracts. Purchase gas costs decreased 23% mainly due to decrease in gas prices and volumes

� Staff costs – increase in salaries in line with inflation rate. Projected 7,9%salaries indexation in 2011

� Transit of gas, oil and refined products - negotiations with transit companies, diversification of transportation routes

� Materials, repairs and maintenance - target upper price increase level –maximum 80% of producer prices growth (based on MED forecast)

� Estimated savings of RR12,1 bln in 2010, RR14,0 bln in 2011, RR21,3

bln in 2012, RR20,3 bln in 2013

� Ongoing reduction of costs in operating activities mainly due to

technological and technical decisions; in investing activities due to further

development of competitive selection system of goods and services

providers

OpEx vs sales

69.5%72.8%


Compensation of gas taxation growth

The revenue from the liberalization of the domestic gas market is expected to be higher than payments along the

mineral extraction tax increase

� The current gas Mineral Extraction Tax (MET) has been flat since 2006

� 61% growth of gas MET in 2011: Around $1.6 bln of additional tax payments from Gazprom*

� Gas MET after 2011 is expected to be increased in line with inflation: Around $4.3 bln of additional tax payments from Gazprom in 2012-2013*

� Price liberalization in the domestic gas market: Around $24.0 bln of additional revenue for Gazprom in 2011-2013*

* Additional tax payments and revenues as compared to those calculated on the basis of 2010 tax rates and domestic gas prices

*

US$bln


2011 investment priorities

Investment program

25.7

JSC Gazprom investment program(1), US$ bln

1. Figures converted in USD using CBR exchange rates average for the period.

Gazprom Group’s capex(1), US$ bln, & self funding position

29.826.7

2011 capex breakdownProduction

Bovanenkovo field; Shtokman fieldMaintenance of production levels on the major fields

Transportation

Bovanenkovo – Ukhta & Ukhta – TorzhokNord Stream; Gryazovets – Vyborg & Pochinki – Gryazovets

Timely CapEx revision gives Gazprom flexibility for optimal resource allocation

142%

113% 105%

157%

16.320.5

32.2

25.5

Transporation


Efficient implementation of investment program

Construction cost of 1 km of pipeline(real 2009 prices), RR mln

Cost of Construction of trunk gas pipeline linear part(3), RR mln/km

1. Source: publicly available data, Wintershall and Gazprom estimates2. Trunk pipeline of 1,420 mm diameter and operational pressure of 7.4 Mpa3. Trunk pipeline of 1,420 mm diameter and operational pressure of 9.8 Mpa4. Including compressor stations , excluding infrastructure costs

Gazprom’s costs of construction of a linear part of trunk gas pipeline is comparable to those in the Western Europe

and the USA

Construction cost of 1 km of pipeline(1)

(nominal prices), RR mln

26%

(1) (1) (2) (2)


Liquidity managementCost of debt financing(2),%

Credit metrics(1)Total and net debt, US$

Debt reduction

Cash pooling system:

� Separate cash pooling systems for Russian and foreign subsidiaries

� 76 subsidiaries and branches involved in Russia

� Earnings from fund allocation in the system increased by 40%

� Potential volume of preferential credits accumulated in the pool amounts to RR25 bln

Maintenance of a balanced debt portfolio allows Gazprom timely access to competitively priced funds

1. Calculated as at the end of the respective period2. Excluding promissory notes


� Remuneration statute adopted

� Timely annual IFRS disclosure

� Sustainability report published

� New web site launched

� Interactive annual report designed

� Quality of information disclosure improved

� Dividend policy revised

Dividend payments to be 17.5% to 35% of net income (parent company, RAS)

Net income may be adjusted by the amount of Gazprom’s investment revaluation

2010 Awards

IR magazine Russia & CIS rating

Best overall investor relationsBest corporate governance

Best annual report

Hallvarsson & Halvarsson international rating

Best Russian corporate website

Corporate governance has steadily improving

Corporate governance in 2010


Gazprom - a global energy major

Major value drivers

Upstream

2x increase of oil refining throughput by 2020

Midstream Downstream

Development of Yamal, Shtokman, fields of Sakhalin and Far East

Increase of high value added oil product salesLiberalized electric power market

2x increase of crude oil production by 2020

Participation in upstream projects abroad(Vietnam, Bolivia, Venezuela, Libya, etc.)

Development of LNG

Development of new transportation routes (Nord Stream, South Stream)

Liberalization of Russian and FSU gas markets

Increase European market shareEntering Asian & Pacific markets

Key building blocks of sustainable growth


Part 4. Vadim Yakovlev

Gazprom Neft

Gazprom Neft - Investor Day 2011 36

Solid performance in 2010 and advancing strategic goals

2010 Highlights

� Solid financial performance in 2010(1)

• EBITDA: US$7,226 mln (+21% Y-o-Y)

• ROACE: 16%

• Cash flow from operating activities: US$5,392 mln

(+55% Y-o-Y)

� Total reserves replacement: 110%

� Production: 52.8 MM toe/yr (+ 5.3% Y-o-Y)

� Refining: 37.9 MM t/yr (+13% Y-o-Y)

� Premium channels sales: 10.7 MM t/yr (+17%Y-o-Y)

� Total shareholder return 2007-2010: 26%

ExpandedUpstream Portfolio

Modernized Refining AssetsIntensified Rebranding and Retail Network

IntegrationDeveloped Premium Sales Channels

Upstream:� Acquired share in SeverEnergia to develop Yamal fields� Investment decision to establish Messoyakhaneftegaz JV

with TNK-BP� Won tender for Iraq’s Badrah field� Signed Production Sharing Agreement with Equatorial Guinea� Entered Junin-6 project in Venezuela

Downstream:� Started four-year $1.9 bln refinery upgrade program � Executed 30% of retail rebranding campaign� Launched sales of the new G-Family Lubricants brand

Finance:� Refinanced debt on more favorable terms� Improved financial performance at NIS

Building the foundation for future growth

1. Based on 2010 unaudited financial statements

Driving growth through superior integration, operational excellence and expanding portfolio


Leading peers in profitability

� Commitment to operational excellence by reducing costs and enhancing earnings

� Acquisitions and production increases drive profitability

� Capitalizing on competitive advantages� Leveraging synergies of integrated portfolio� Cutting costs, boosting operating cash flow and

improving profitability� Delivering working capital improvements

Note: Competitor data estimated on a consistent basis with Gazprom Neft, and based on public information

EBITDA, US$/boe Operating Cash Flow, US$/boe


Sound financial policy balances ambitious investment program and competitive dividends

Peer Capex & Dividends vs. Cash Flow Net Debt/EBITDA and Maturity Mix

� Maintain Debt/EBITDA below 1.5

� Debt balance has shifted towards long-term debt

� Continuing investment program

� Sustaining responsible dividend policy

� Delivering free cash flow

Net Cash Flow

ND/EBITDA ST/TD


Impressive growth in shareholder value backed by solid returns

Healthy ROACE though material inorganic

growth

Competitive returns

among peers

2007-2010 Total Shareholder Returns

Note: Competitor data estimated on a consistent basis with Gazprom Neft, and based on public information

Trailing ROACE

MICEX-+0%


Committed to providing superior shareholder returns through long-term profitable growth

40 MMTonnes of high value-added product sales (0.8 MMbpd)12 MMTonnes retail fuel sales (8.2 MMTonnes in Russia and CIS)18 MMTonnes in premium markets (aviation, lubricants, bunker, bitumen and petrochemicals) 10 MMTonnes direct sales to large end-users

70 MMTonnes refining throughput (1.4 MMbpd)Raise light products yield to 77%Increase processing depth to 90%

100 MMTonnes oil equivalent production (2 MMboepd)Reserves/Production ratio > 20 yearsProduce at least 50% from fields at first stage of development

Maintaining efficiency leadership in the oil industry

Providing superior shareholder returns

Note: Based on 2020 targets


▪ Gazprom assets

▪ M&A in the area

▪ Mobilization synergy

▪ Unlicensed Federal resources

▪ Novoportovskoye oil field

▪ Messoyaha field

▪ Exploration area

▪ Oil transportation synergy

Novoportovskoye

Messoyaha

Gazprom assets

– Messoyaha

– Gazprom

– Sever Energiya

– Unlicensed Federal resources

Exploration

“Zapolyarye Purpe” pipeline

– Exploration area (after 2020)

– Projected pipeline

Yamal peninsulaGydan

Future Yamal projects open access to exciting new exploration and development regions


Novoportovskoye

Novatek fields

Sever Energia

Messoyakha

Agreed Sever Energia Ownership:

51% - Yamal Razvitie

(50/50 Gazprom Neft and Novatek JV)

49% : Eni + Enel

� Gazprom Neft and Novatek acquired 51% of Sever Energia from Gazprom which will allow Gazprom Neft to:

– Exploit synergies between Gazprom Neft and Novatek upstream and downstream assets in Yamal-Nenets Autonomous District

– Benefit from expected tax concessions for field developments in this area

� Production start up (under preliminary estimate): 2012(e)

� Peak production (under preliminary estimate): 35 MMtoe by 2019(e)

Gas Bcm 919

Condensate MMtonnes 109

Oil MMtonnes 330

Total MMtoe 1,177

Estimated reserves ABC1+50%C2:

Acquisition of Sever Energia:Expansion into North YANAO region

Samburgsky license area

Yaro-Yahinskylicense area

North-Chaselsky license area

Evo-Yahinskylicense area


Eastern block of Orenburg field

Novogodneye and Muravlenko fields

Eastern Orenburg block and Cenomanian Gas:New upstream projects

▪ GPN-Orenburg Asset transfer was initiated according to approved

strategy

▪ ABC1 Reserves of 138 MMToe

▪ Current production of 1.1 MMToe

▪ Peak production of 3.2 MMToe expected in 2015

▪ Resource growth potential due to open acreage and minor subsoil

users

▪ Cenomanian gas development project covers deposits at

Muravlenko and Novogodneye fields

▪ ABC1 Reserves of 51.2 MMToe

▪ Production start: December 2010

▪ 2011 estimated production of 3.2 MMToe

Orenburg

East regionOrenburg GPP

Orenburg Helium Plant

Buguruslan

Buzuluk

Kazakhstan

Republic of Bashkortostan

Salavat Oil Refinery


� Region: Iraq

� Field: Badrah

� Operator: GPN

� Contract with the government of Iraq for Badrah field development

� Key contract provisions: production starts no later than February 2013, reaching plateau of 170 mb/d in 2016, with a plateau production period of 7 years

� Compensation for expenses: 100% of oil-related expenses; base for compensation: 50% of revenues

� Region: Libya

� Field: Elephant

� Operator: Eni

� Expected acquisition of Eni’s 33% share and further participation in field development

� Within the strategic partnership agreement, Gazprom and Eni will assign 33% out of the 66% owned by Eni in the consortium of foreign companies that are developing the field

� Offers continental production in the most promising region of North Africa

� Region: Venezuela

� Field: Junin-6

� Operator: PetroMiranda

� JV between PDVSA and the Russian National Oil Consortium

� Declared project leader for field development at Junin-6 (Venezuela)

� Region: Equatorial Guinea

� Offshore blocks: Т & U

� Operator: GPN

� PSA with Ministry of Energy of Equatorial Guinea and the NOC GEPetrol for the selected offshore exploration blocks (sea depth: 400-1,500 m)

JV structure

GPN

Rosneft

Lukoil

TNK-BP

Surgutneftegaz

PetroMiranda (Operator)

20%

GPN(Operator)

80%

GEPetrol

JV structure

60%

JV structure Consortium structure

KNOCOil Exp Comp 25%

TPAO

8%

Petronas

15%

KOGAS

23%

GPN(Operator)

30%

33%

Eni (Operator)

GPN

33%33%

Robust international project pipeline will deliver upstream growth

8%


2009 - 2010 results(1):Completed projects:-Reconstruction of diesel hydrotreater-Reconstruction of gasoline redistillation unit (crude oil distillation plant) -Light gasoline fraction isomerization

Moscow Refinery Omsk Refinery Yaroslavl Refinery

2009 - 2010 results(1):Completed projects: - Hydrogen generation unit-Diesel hydrotreater-On-going projects:- Primary distillation unit construction; -Isomerization unit; - Catalytic cracking gasoline hydrotreater

Through 2020Planned projects:- Diesel hydrotreater- Catalytic cracking gasoline hydrotreater unit- Isomerization unit- Alkylation unit- Residual hydrocracker

Through 2020Planned projects:-Catalytic cracking gasoline hydrotreater-Isomerization unit-VGO hydrocracker-Tar hydrocracker-Units aimed at increase in octane level (Alkylation)

2009 - 2010 results(1):On-going project:-Light naphtha isomerization unit-Catalytic cracking gasoline hydro elevation unit--Reconstruction of hydrotreater

Fuel classes – Euro 5 from 2015Refining depth– 92%

Light products yield– 77%

Fuel classes – Euro 5 from 2015Refining depth – 86%

Light products yield – 73%

Fuel classes – Euro 2, Euro 3Refining depth– 73%


Fuel classes –Euro 2, Euro 3, Refining depth– 66%


Ambitious medium-term investment program is boosting refining complexity and light product yield

1. Only selected large-scale projects are mentioned

NIS Refinery

2009 - 2010 results(1):On-going project:-Construction work for MHC/DHT unit, Hydrogen Unit -Completed the first stage of reconstruction and capital repairs to the fluid catalytic cracking unit

Through 2020 Planned projects:- Catalytic cracking gasoline hydrotreater-Diesel hydrotreater-Vacuum gasoil (VGO) hydrocracker -Coker unit

Through 2020Planned projects:-MHC/DHT unit to boost Euro 5 output-Hydrogen unit, sulfuric acid regeneration unit , sulfur unit and azote-oxygen unit-Residue utilization unit

Fuel classes – Euro 5 from 2015

Refining depth– 95%Light products yield– 79%

Fuel classes – Euro 5 from 2013Refining depth – 84.81%

Light products yield – 69.78%

Fuel classes –Euro 2, Euro 3Refining depth – 87%

Light products yield – 70%

Fuel classes –Euro 2, Euro 3, and Euro 5

Refining depth– 72.53%Light products yield– 62.08%


Continuing to develop business units in high: Margin premium sales channels

� #1 retail supplier of aviation fuel in Russia

� Sales volume growth of 15.6% Y-o-Y

�Opened new fueling terminals in Moscow (Vnukovo airport), Surgut and Chita

� Total locations: 12 airports in

Russia and 18 abroad

� 2010 market share in Russia

reached 17%

� #1 supplier of bunker fuel in

Russia

� Retail sales grew 18.5%

Y-o-Y

� Opened new terminals to

serve Astrakhan,

Volgograd, Cherepovets

and Irkutsk

� Total locations: 20 ports

� 2010 market share in

Russia reached 18%

�Launch of G-Family Lubricants

brand

�Sales growth of 21% Y-o-Y

�Planned product range envisions

increase from 242 products to 315

�Geographical expansion plans:

- Increase sales in Europe,

Ukraine and Belarus

- Lubes plant under

construction in Omsk

�2010 market share in Russia

reached 8%

�Rebranding campaign well

underway, with 921 stations fully

or partly rebranded

�Rebranded stations registered

17% Y-o-Y increase in per-day

sales volumes

�Retail sales grew 21% Y-o-Y

�Established Kazakh retail

network via purchase of 19

stations

�2010 market share in Russia

reached 8%

Аviation Bunker Lubricants Retail


2010 2011E

Hydrocarbons production(2) 52.8 MM Toe 56.8 MM Toe

Refining 37.9 MM T 38.4 MM T

Retail products sales via premium channels

10.7 MM T 12.8 MM T

Investments(1), US$bln

4.6

2011 outlook sees 8% production growth from continued organic investments

Кey Figures(1)

Source: Company data;

1.Calculated using Company’s base scenario ($75/bbl – Urals price; exchange rate 1 USD = 30 RUB and based on unaudited 2010 financial statement); 2011 investments - under consideration

4.9

+ 7.6%

+ 1.3%

+ 20%

Investments(1)

Organic Capex(3.3) US$bln

(3.8) US$bln

New projects (1.6) US$bln (0.8) US$bln

- 6%


Part 5. Denis Fedorov

Gazprom Energoholding

Gazprom Energoholding - Investor Day 2011 49

Kaliningrad450 MW

St. Petersburg

Moscow

Krasnoyarsk

Surgut

Kaunas

Gazprom group power generation assets: significant volume and complementary structure

Installed electricity capacity 11.9 GW

Installed heat capacity 34,865 GCal/h

Market capitalization $4.2 bln(1)

Gazprom share 53.5%




Gazprom share 60.6%




Gazprom share 57.95%




Gazprom share 51.8%

Total installed capacity

36.63 GW(1)

1. Including Power Unit #2 of Kaliningrad TPP-22. As of 11.01.2011

Installed Capacity of Russian Generating Companies, GW

Adler


2010 progress highlights: our efforts yield results

1) Advantages from new installed capacity (676 MW)

2) Investment program optimization led to CAPEX reduction to

bellow benchmark

3) Implementation of efficiency enhancement programs within

companies will be continued

OGK-6 TGK-1 Mosenergo

� Staff efficiency increase: staff (number) per installed capacity (MW)

ratio decreased from 0.8 in 2009 to 0.72 persons/MW in 2010

� Mosenergo Lean Project was rolled-out to 7 TPP by the end of 2010

� Starting from 2008 the volume of pollutant emissions at Troitskaya

GRES was reduced by 37 thousand tons annually as a result of

reconstruction of electrical filters

Return on investment projects in accordance with benchmark CAPEX

14%

2010 Major Achievements (1) 2010 New Capacity Commissioning, MW

(2) New Project IRR is above Average Benchmark (3) Increase of Efficiency and Safety


Electricity Output, bln kWh Heat Output, mln GCal(1)

2010 operational results: stable growth driven by increased efficiency

1. Totals may not sum due to rounding2. Ministry of Energy, July 2010

Total 164.6Total 174.6

Total 96.7Total 103.0

Mosenergo TGC-1 OGK-2 OGK-6

2009 58.7% 48.4% 62.0% 36.5%

2010 62.3% 49.3% 62.4% 43.7%

Installed Capacity Utilization Ratio Electricity Demand, bln kWh(2)


2010 financial outlook

Total 34.1

Total 41.3

Total 12.4

Total 17.2

� Dividend policy has been approved by all Gazprom GenCos :

� Size of Dividends: from 5 % to 35 % of RAS Net Income

� Payment Period: 60 days

Revenue(1), bln RR EBITDA(1), bln RR

Net Income(1), bln RR Dividend Policy Approved

Total 233.1

Total 298.3

1. RSA results


Financial coefficients and potential for growth

Note:• The data for OGKs and TGCs is based on 9 months 2010 RSA financial statement.• Russian gencos capitalization was obtained from QueteTotal2 as of 30.09.2010, and foreign gencos capitalization was obtained from Bloomberg as of 30.09.2010• Emerging economies average consists of: NTPC, Datang International Power, Huadian International Power, AES Gener S.A., Ratchchaburi Electric, Glow Energy PCL, First Gen Соrp, Gujarat Industries Power• Developed economies average consists of: International Power , Public Power S.A., Allegheny Energy, Southern Company, Drax Group plc, Contact Energy, TransAlta Corporation, Energy Developments Ltd

EV/IC, $/kW EBITDA/IC, $/kW

Installed Capacity Utilization Factor, % EBITDA Margin, %


Strategic direction: further steps to power generating leadership

In cooperation with a leading management consulting company Gazprom Energoholding is developing and implementing a long-term strategy and a new business architecture to upgrade its power generating assets

Strategy development

Implementation of investment program

Further increase of efficiency and safety

Implementation of new business model based on global best practice

Single share conversion followed by IPO


Gazprom Energoholding 2020 vision

5%

View – 2020

Weighted-average

Ave

rage reve

nue growth, 200

7-20

09

EBIT margin, 2007-2009

-20%

-15%

30%

25%

20%

15%

10%

0%

-5% 0% 5% 10% 15% 30% 35%

Profit growth

MosenergoTGC-1

OGK-6OGK-2

TGC-14

TGC-2

TGC-8

OGK-1

TGC-4

OGK-3

(2)

2)(3)

Development program execution – 2020

EBIT margin Revenue CAGR

>20% >20%

IBERDROLA

Gazprom companies EU leadersOther Russian companies Revenue 2009

Source: Company dataNote: The data for 2008-2009; 1) including OGK-4; 2) including OGK-5, Endesa; 3) including TGC-10

(1)


2011 goals and expectations: further development and progress

Market Operation under New Conditions

� We expect to upgrade our operations under new market conditions :

� Further market liberalization

� Long-term capacity market launch

Management development

� Further improvement of efficiency and safety

� Continue standardization of business processes within the Group’s generating companies

� Implementation of ERP system

Continue Investment Program

� 1.9 GW of new capacity to be commissioned:

� 420 MW - Mosenergo

� 660 MW - TGC-1

� 800 MW - OGK-6


Major value drivers

Externaldrivers

Internaldrivers

� Stable demand for electricity

� Increase in energy consumption

� Liberalization of electric power market

� Long-term capacity market

� Commissioning of new capacities within the framework of DPM

� Cost control� CAPEX control and

efficiency� Increase in operational

efficiency� Reasonable distribution

and capacity market policies

� M&A

58

Contacts for investors

Department for Finance & Economy

Capital Markets Division

Fax: (007) (495) 719-35-41

Peter BAKAEV

Head of Capital Markets Directorate

Phone: (007) (495) 719-23-09

E-mail: [email protected]

Oleg NAGOVITSYN

Deputy Head of Capital Markets Directorate

Phone: (007) (495) 719-26-25


Andrei BARANOV

Investor Relations

Phone: (007) (495) 719-25-89


all you need is gas · 2010 2020 2030 0% 20% 40% 60% 80% 100% 2010 2020 2030 diversification of gas...

Documents