OREANDA-NEWS. OJSC MMK and Gazprom, represented by its regional subsidiary OOO Chelyabinskregiongaz, have signed a long-term contract for the supply of natural gas, MMK's press service reported. The 5-year contract signed by Victor Kutischev, OJSC MMK's Commercial Director, and Yury Fischer, General Director of OOO Chelyabinskregiongaz, provides for guaranteed supply of natural gas to MMK in agreed upon volumes. The contract specifies annual volumes of supply as well as the daily volume based on process requirements. Under the terms of the contract the annual supply will exceed 3 billion cu. m. In addition to the volumes, the contract sets out the conditions and procedure of gas supply, methods of take-off by the buyer, gas accounting, prices and settlement procedure. "The signing of the contract gives us confidence that our Company's plans for the period up to 2012 will be backed with required power resources," Mr.Kutischev remarked.

In addition, the contract is in tune with the Company's plans of establishing strategic partnership relations and signing long-term contracts with suppliers of key raw materials. Thus, in early 2007 MMK signed a 10-year contract for supply of iron ore materials from the Sokolov-Sarbaisky Iron ore Mining and Beneficiation Plant; there are also 5-year contracts in place with the main suppliers of coking coal. Moreover, the signed contract will contribute to the further strengthening of ties between OJSC MMK and will complement an agreement of cooperation between the two companies for the period up to 2015, entered into in August of 2007, aimed at meeting the requirements for steel products of the gas giant and its suppliers of steel pipes. In particular, the agreement provides for the parties' cooperation regarding organization of production of rolled plate for manufacture of large-diameter pipes in view of OJSC MMK's 5,000 Plate Mill project.

As Yury Fischer pointed out, "the signed document is of great importance for the Chelyabinsk Region, MMK and Chelyabinskregiongaz. What the document is all about are guaranteed gas supplies, stability, and our long-term cooperation. MMK is the largest consumer of natural gas in the Chelyabinsk Region, and our strategic partner." "Therefore, even at the conditions of gas deficit, we will take all necessary steps to make sure that Magnitka continues producing steel," the Gazprom executive added.