OREANDA-NEWS. March 25, 2009. The Gazprom Headquarters hosted today a working meeting between Alexey Miller, Chairman of the Gazprom Management Committee and Paolo Scaroni, Chief Executive Officer of ENI concern.

The parties addressed the prospects for further cooperation in the oil and gas sector. In particular, Alexey Miller and Paolo Scaroni discussed the progress with executing the pre-investment stage of the South Stream project and the plan of further actions related to the offshore gas pipeline construction.

The meeting noted that that South Stream rested upon a reliable resource base and was capable of substantially enhancing the reliability and flexibility of gas supplies to Europe. Considering that the European Union recognizes the importance of diversifying the export routes from Russia, the rapid project implementation is gaining particular relevance.

Background:

Italy is the second-largest importer of Russian gas in Europe. According to the provisional estimates, in 2008 Gazprom supplied Italy with more than 22 billion cubic meters of gas.

In November 2006 Gazprom and ENI entered into the Strategic Partnership Agreement providing Gazprom with the opportunity to directly supply Russian gas to the Italian market starting from 2007. Gas supply volumes will be gradually increased to 3 billion cubic meters per annum by 2010. Under the Agreement the existing contracts for Russian gas supplies to Italy have been extended till 2035.

On June 23, 2007 Gazprom and ENI concern inked the Memorandum of Understanding for the South Stream project implementation. The MoU sets the areas of cooperation between the two companies in designing, financing, constructing and managing the South Stream.

On January 18, 2008 South Stream AG, a special purpose company was registered in Switzerland. South Stream AG was incorporated by Gazprom and ENI on a parity basis.