OREANDA-NEWS. May 30, 2012. On the threshold of the annual General Shareholders Meeting the Gazprom headquarters hosted today the Press Conference entitled “Gazprom's Power Generation Strategy”. Among the Press Conference participants was Denis Fyodorov, Head of the Directorate for Power Sector Development and Marketing in Power Generation of Gazprom and Director General of Gazprom Energoholding.

It was highlighted that Gazprom Group owned and efficiently operated Russia's major power generating assets with the total installed capacity of around 38 GW. In five years of the Group's power sector existence, its generating companies proceedings have grown by 87 per cent and the net profit has grown by more than 3.5-fold.

Gazprom Group is a largest investor in the Russian power industry. In 2011 the Group carried on the investment program in the power generation sector according to the approved plans. This lays the foundation of advancing its power generating business in the future. Last year, the Company built combined heat and power generating facilities with the total capacity of some 1.9 GW. This is more than RAO UES of Russia had built over the entire period of its existence. In general, from 2007 until today Gazprom has commissioned 4 GW of new generating capacities out of planned 9 GW under the capacity supply agreements (CSA).

The CSA projects produce a strong economic effect that is proved by the already commissioned generating facilities. For instance, in 2011 the new facilities of the Pervomaiskaya CHPP and Yuzhnaya CHPP secured 10 per cent of TGC-1  total proceeds as well as 17 per cent of the marginal income in the wholesale
electricity market (WEC). In the second half of 2011 Mosenergo  realized 8 per cent of the total revenue
and around 15 per cent of the WEC marginal income from the new equipment (power generating unit CCGT-420 at CHPP-26).

Following the CSA projects results, by 2017 the new capacities will generate up to 70–80 per cent of profit for the holding companies.

Between 2012 and 2014 WGC-2  will simultaneously deliver several major CSA projects involving around
RUB 80 billion of finances. Between 2012 and 2013 the company plans to launch an additional share issue to finance its investment program.

Timely and successful completion of the investment program within CSA and further consolidation of circulating capital will help prepare Gazprom Energoholding for listing on foreign stock exchanges with the follow-up IPO and transformation into a blue chip company of the global scale.

The Press Conference also addressed a lot of questions concerning operation of Gazprom's power generation facilities in Russian regions.