14 Blue Fuel Newsletter 1q 2012 MINI

7/27/2019 14 Blue Fuel Newsletter 1q 2012 MINI

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To Our Reader

Mission No

Impossible

Gazprom Export Global NewsletApril 2012 | Vol. 5 | Issu

Page

Pag

Pag

Subsidies for RenewaPower Sources in EU C

Almost Fifty Billion Eu

Sakhalin EnergSetting New Goa

Gazprom Export

www.gazpromexport.com | [email protected]

+7 (499) 503-61-61 | [email protected]

BLUE FUEL


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BLUE FUELGazprom Export Global Newsletter


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April 2012 | Vol. 5 | Issue 1

To Our Readers: Mission Not Impossible ...............................Pg. 4

Looking Into 2012 with Moderate Optimism ...........................Pg. 5

Sakhalin Energy: Setting New Goals.........................................Pg. 6

Building Global Shipping Capability for Trading andFuture Export Projects of Gazprom ..........................................Pg. 8

Wintershall is at Home in Russia ..............................................Pg. 9

Achimov Gas from a 4-Kilometer Depth ................................Pg. 11

G4T: Gas for transport in the Czech Republic ........................Pg. 12

Subsidies for Renewable Power Sources in EU CostAlmost Fifty Billion Euro..........................................................Pg. 14

Innovative Partnerships to be Found ......................................Pg. 16

Algerian Energy Policy: From Hydrocarbons to a

Diversified Mix of Energy ........................................................Pg. 18

Natural Gas Growing Role in Global Energy Mix ....................Pg. 20

Christmas Ball for Children at Hofburg ..................................Pg. 21

A Touch of Fantasy ..................................................................Pg. 21

Instant Photo Truth ................................................................Pg. 22

Blue Fuel Receives Best Corporate Media 2012 Award .........Pg. 22

Publishers Contact Info:www.gazpromexport.com | [email protected]

+7 (499) 503-61-61 | [email protected]

In this issueApril 2012 | Vol. 5 | Issue 1


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Ask yourself : is there currently a viable alternative to the pipeline gas reliably deliveredto Europe under Gazprom Exports contracts? The answer is obvious. Results from thepast year clearly show that the spot market is not yet sophisticated enough to cope witha high surge in demand and that Gazprom Export continues to be a reliable and securesupplier to Europe.

Renewable sources of energy? A good cause. But they are still technologically immatureand therefore are expensive, and they only survive thanks to huge subsidies fromEuropean taxpayers.

Gas at spot trading platforms? A good thing. But since this gas is physically insufcient inEurope, the main ow goes to more favorable premium markets in Asia. This was provenin early 2012 when spot markets failed to effectively address the surge in demand due

to unseasonably cold weather across Europe. Instead, it was the security of oil-linkedcontracts that ensured Europe's energy needs were met. Therefore, it is fair to argue thatspot markets merely play the role of a "supporting actor," as they would say in the theatre.While spot performs the role of a balancing market, unlike long-term contracts, it does notensure energy supply security.

The positive balance in 2011 was predetermined by this. Despite the slow post-crisiseconomic recovery in Europe and the CIS, Gazprom Export has signicantly increasedsupply with about 150 bcm of gas exported to Europe last year. The main growth was inWestern European countries 13.5 percent more compared to the year 2010.

Moreover, we have regularly found ourselves helping our neighbors in need. Whocompensated the energy decit for Turkey when there were interruptions in Iranian gas

supplies? Gazprom Export. Who came to the assistance of Italy when it stopped getting itsNorth African gas due to the civil war in Libya? Gazprom Export.

The results achieved conrm that our development strategy is correct. We are increasingLNG production. This new product increases the exibility of supply and availability ofpremium markets. We are diversifying our customer base and opening up new markets inAsia. The pipeline project in South Korea passing through North Korea no longer seems likea pipe dream. Moreover, we are not forgetting Europe, to where we plan to bring the secondline of Nord Stream and build the South Stream gas pipeline.

We have an important, fascinating and complicated mission ahead. But the undoubtedsuccess of 2011 gives us condence that succeeding in this mission is possible!

TO OUR READERS:

Mission Not Impossible


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www.gazpromexport.com | [email protected] | +7 (499) 503-61-61 | [email protected]

BLUE FUELApril 2012 | Vol. 5 | Issue 1

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Blue Fuel: The department you are leading provides for

gas deliveries to a number of key countr ies, includingGermany, Italy and France. How do you perceive

the current state of the gas markets in this part of

continental Europe?

Dmitry Averkin (DA):The words rapidly changing couldcharacterize it in the best brief way. The gas market is in no wayconstant although its fundamentals are the same. What setstoday apart from the past is that new trends keep appearing.When I came to the gas business almost 18 years ago, itwas stable and predictable for years ahead, and they used tocall it the oldies market behind our backs. This had certainadvantages, however, especially for our industry, which wasalways calling for predictability, to securely plan the deliveriesand, accordingly, put long-term investment into production,infrastructure etc.

Today, the market is everything except the oldie. Many thingshave started moving, the market has gained new momentum,and the spirit and behavior of the players has become moredynamic. And yet, I do not feel there is a shared, uniform andunambiguous understanding of the current situation amongthe gas market players in Europe. Although todays trends arebacked by certain objective developments, some purely politicaldecisions taken on the EU level are politically motivated. To whatextent the reasons behind these steps are objective and market-motivated, is a separate issue.

Blue Fuel: Do we have a clear understanding of where the

market is moving to?

DA: Absolutely, Gazprom Export has its vision on the futuredevelopment of the European gas market. We keep pacewith it, keep looking for the ways to adapt to new realities,seeking to protect our interests and more, provide for the rightbalance between the interests of buyers and consumers. Thekey issue is that within the new dynamics, the backbone ofthe gas business in continental Europe remains the same it

is the system of long-term contracts. No major player doubtsit, as it is exactly these contracts that provide the security ofsupplies for consumers and the security of demand for us thesuppliers.

Blue Fuel: How does your department view the results

of 2011? How do you see the new 2012?

DA: Last year was complicated enough. We conducted difcultnegotiations on the review of certain contract clauses with anumber of partner companies. We nd it satisfying that in late2011 and early 2012 we managed to reach agreements withmany of them. This process is yet ongoing, and reects thewillingness of both parties to adapt to market changes, while

preserving the balance of interests.Along with that, the last year was successful enough for usin regards to deliveries. All in all, Gazprom Export in 2011supplied 150 bcm, compared to 138 bcm in the previousyear. These results were achieved despite lacklustereconomic growth in the EU countries which are our biggestclients. Considering the problems in the Euro zone andcorresponding fears, it is clear that the growth of offtake isa sign of condence in Gazprom Export as the supplier, andin our contracts as the reliable basis of the trade.

In 2012, we expect that the gas offtake under GazpromExports contracts will not be lower than in 2011, at least.

We are conservatively optimistic in that. At the same time,we continue negotiations on pricing where we have not yetfound any compromise solutions with the partners. We areoptimistic on the outcome and hope that such solutions will befound this year.

Blue Fuel: How are the pricing negotiations moving on?

With some companies, arbit ration procedures were

initiated

DA: Appealing to arbitration does not mean that the partiesdo not wish to nd a compromise along with it. One does notexclude another. We could take such processes as parallel.These fully correspond to usual regular procedures foreseen inthe contracts. Sometime, we initiate this proceeding, sometimesit is done by our clients, the same happens with other suppliersand their clients, in other industries.

At the negotiations on pricing we naturally defend our interests,based on certain principles. Every change to the contractshould reect the real moves on the real gas market, and notjust theoretical, or wishful thinking. The compromise is alwaysreached when both parties move towards each other, both

Looking Into 2012 with Moderate Optimism Blue Fuel interv iewed Dmitry Averkin, the newly appointed Head of Department of Gas Export to Nor th and Southwest Europe.

Continues on page 6


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three years, Sakhalin Energy has delivered more than 400cargoes of this new-for-Russia energy source to its buyers.

The company is steadily and surely moving towards its missionof becoming a premier energy source for the Asia-Pacic regionrecognized for its safety, operational excellence and reliability.

Sakhalin Energy is committed to conducting its business inan ethically, socially and environmentally responsible manner.This approach has earned us trust and a strong reputationwith our buyers. Furthermore, in 2011 Sakhalin Energy proveditself as not only a visible player in the LNG market, but also asignicant element of ensuring energy security in Asia-Pacic.This was demonstrated by our quick response in supplyingadditional LNG to J apan following the disastrous earthquake inMarch 2011. Last year, Sakhalin Energy shipped 34 above-planLNG cargoes to J apan, part of which were diverted from otherbuyers, while nine were purely upside cargoes.

Our high production levels were a result of our operational

excellence initiatives and successful LNG debottleneckingefforts. Debottlenecking is an international practice aimedat process optimization and equipment adjustment afterthe start of an LNG facility, and it usually results in a 5-10%increase in the LNG production.

We see reliability as one of our top priorities. In 2011,Sakhalin Energy conducted its rst integrated shutdown forthe maintenance and repair of gas lines. It was the mostchallenging planned shutdown operation since the start of thePhase 2 Project. It was completed successfully thanks to thecareful planning and safe operation of hundreds of companyand contractor staff.

Reliable supplies rest on a stable and robust production basis.In 2011, Sakhalin Energy continued its drilling operations at theLunskoye eld and the Piltun area of the Piltun-Astokhskoyeeld. We also completed a two-year rejuvenation program onthe Molikpaq platform in the Astokh area, which will enableupgrades and work-overs on the existing wells, as well as thedrilling of new ones. Large-scale well drilling, water injectionand water cut reduction programs will be continued in 2012.

Our key priority is safety, and world-class safety performancehas become our trademark. We pride ourselves in ourextremely low injury rate, which is due to our persistent focus on

enhancing the corporate safety culture, including road safety. Interms of process and industrial safety, Sakhalin Energy enjoysa year-to-year superiority as the best oil produced/oil spilledperformer: having produced 44 million barrels, we spilled only0.38 bbl in 2011. Calling this performance outstanding would beno exaggeration.

An important driver of the companys successes is ouroperational excellence program launched in the end of2010. We have identied ve key areas for the purpose ofoperational excellence delivery: total reliability, world classeld development and well and reservoir management, bestcontractor management, lean execution and excellence inhuman resources. In each area we make use of key tools toachieve our purpose and enhance the operational excellenceof the company. For example, our lean execution policyprovides for the use of such well-recognized methods as J ust-in-Time, the Kaizen approach, seven wastes analysis, etc.

The purpose of any business is to derive an economicbenet. Early in the Sakhalin-2 development, there was aheated debate in Russia as to whether or not our projectcould be considered benecial for the Russian Federation.But today, there is good news: in 2011 alone, prior to theSakhalin-2 project reaching its full cost recovery, the RussianFederation received from the project more than a billiondollars of total payments. In the rst half of 2012 we expectthe project to reach full cost recovery. This means thatproduction sharing will start earlier than expected and Russiawill start to receive bigger revenues.

Finally, in 2012 Sakhalin Energy has made growth a priority.We will make every effort to maximize the value of the

Sakhalin-2 license area and infrastructure, while minimizingexposure to risks. Signicant volumes of hydrocarbons withinour two elds are not yet covered by existing plans. Currentlythe South Piltun opportunity in the Piltun-Astokhskoye eldis being considered for further development of Sakhalin-2.The decision on this will be based on the assessment ofall technical, environmental and economic aspects of thepotential development. Apart from the South Piltun project,we are also looking at other growth opportunities. Whicheveroption we select it will be aimed at stimulating the efciencyof the Sakhalin-2 Project and maximizing its value.


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The foundation for GM&Ts Shipping & Logistics(S&L) business unit was rst laid in 2008 whenwe began offering professional and cost-effectiveshipping and cargo solutions, rst in LNG andthen across many types of commodities.

The S&L business is effectively built around veteams: Chartering, Commercial Operations,Technical and Marine Assurance, ShippingOperations and, most recently, the Gas ForTransport business development team. Our teamis now more than 20 people strong, combiningexperience, energy and ambition and working onthe 24/7/365 basis out of London and Singapore.

In 2011 our core operation revolved around aeet of ve modern time-chartered LNG vessels:

Clean Power and Clean Energy from Dynagas(Greece), Neva River from K Line (Japan), LNGPioneer from MOL (Japan) and Stena Blue Skyfrom Stena Bulk (Sweden) and one LPG vesselGas Evoluzione from StealthGas (Greece).Together they sailed more than 300,000 nauticalmiles and made more than 100 port calls allaccomplished with zero injuries or environmentalincidents. The S&L team managed more than 2million tonnes of liquid cargoes (LNG, LPG andpetroleum products), including the GM&Ts 100thcargo of LNG.

The credibility of Gazprom in tanker shipping

is extremely important, which is why we areactive members in the leading maritime industryorganisations - Oil Companies InternationalMaritime Forum (OCIMF), the ChemicalsDistribution Institute (CDI) and the Societyof International Gas Tanker and TerminalOperators (SIGTTO). Furthermore, to ensure therobustness of our processes and proceduresand to be accepted by our counterparties, wehave introduced a quality management system inS&L which is certied under the ISO 9001:2008standard by Lloyds Register Quality Assurance.

We also achieved a number of rsts for thegroup last year - signed our rst long-termcharters for LNG vessels that will be built inSouth Korea in 2013-14, chartered very largegas carriers (VLGC) for the transportationof LPG and carried and managed the rstcargoes traded by GM&T in LPG, gasoline,naphtha and gas condensate.

We also saw the rst participation of Russianofcers on our chartered LNG ships. In 2010we launched a partnership programme with the

Admiral Makarov State Maritime Academy in StPetersburg, which resulted in 16 Academy cadetreceiving sea-going practice on our charteredLNG vessels to-date. Ten of these cadetsreturned to our LNG ships after graduation as

junior navigation and engineering ofcers.

As part of our Russian content initiative wesponsored the creation of the Tanker Operationslaboratory at the Navigation Faculty of theAcademy (with support from Transas, a Russiandigital navigation equipment company). Thelaboratorys facilities and courses with Capt.

Baskakov, the GM&T Professor of TankerOperations, have been extremely popular withcadets. Moreover, we have facilitated the creatioof long-term partnership programmes with the

Academy and the worlds leading classicationsocieties such as the American Bureau ofShipping and Lloyds Register and RussianMaritime Register of Shipping.

These, and many other initiatives underdevelopment, are geared towards developinga cadre of rst class Russian tanker shippingexperts who will command the tanker eets inShtokman, Prirazlomnoye and other Russian

LNG and oil export projects in the future.

Everything we do is about adding value. Onthe systems front we are now using IMOS6,one of the worlds leading shipping operationsystem, which has considerably enhanced ourquality, reliability, value preservation and costmanagement by offering real time fuel curves,voyage reports and vessel tracking. Combinedwith our global hub agency system GACShipand GM&Ts own SAP system, this programhas really taken us to the next level. The active

Building Global Shipping Capability forTrading and Future Export Projects of GazpromNikolai Grigoriev, GM&T Director of Global Shipping & Logistics


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Blue Fuel: Wintershall is active in many countr ies round the

world, but so far none of these have been represented by

their own board division. Why has an extra board division

now been created for the companys Russian activi ties?

Mario Mehren (MM): Our Russian activities go back many yearsand have been growing continuously, which is why we took thedecision to bring all our Russian activities together and combinethem with the Nord and South Stream pipeline shareholdings intheir own board division.

cargo management and assurance activities of our CommercialOperations team contributed to substantial savings and efcienciesfor the trading portfolio in 2011.

The S&L team works in a real spirit of openness and collaboration.

Sharing our knowledge benets with our colleagues in GazpromExport. We monitor all the freight markets GM&T is currentlyinvolved in from LNG to petroleum products and LPG anddistribute the market information through our GM&T FreightWeekly. Having already supported several Gazprom Exportinitiatives, such as shipping helium by trucks from Orenburg tocustomers in Western Europe and taking the rst steps in thedevelopment of Russian rail logistics, we invite colleagues to throwus any logistical challenge whether its a new commodity or a newmode of transport!

The delivery of the transportation solutions, cargo managementand assurance is at the heart of our offering and we hope to see ourcompetencies and capabilities acknowledged and used increasinglyby the Gazprom group. The uniqueness and exibility of ourplatform offers limitless volumes in terms of logistics particularlymaritime, but we can also add land-based capabilities if necessary.It is no exaggeration to say that we thrive on partnerships andcollaboration. For example, we have a very strong relationship withour LNG trading desk. Since S&L and LNG trading were launchedalmost concurrently in 2008 weve evolved and grown togetherand jointly built up a global LNG trading and shipping portfolio. Thisprovides us with unique exibility and a distinct advantage over

our competitors who may not have vessels available. Entering LNGshipping deals ahead of the pack in 2009-10 allowed us to securecompetitive shipping, which now supports our trading operations.Without the support from our traders back then who indicated theneed for vessels we couldnt have achieved this.

We also work hard to forge external alliances. We have builta strong relationship with our partners at the Sakhalin EnergyInvestment Company (SEIC). For the last three years we havereceived LNG from SEIC under long-term contracts and havesub-chartered our LNG vessels to the company, supporting theirrequirement for additional ships capable of working in the harshwinter/ice environment.

We have worked with Gazprom Export and Gazprom from our rstday and will continue to actively share our expertise with the aimof making our S&L function the platform of choice for the groupsmulti-commodity trading and export projects . We also expect tosee our capabilities used in developing small scale liquefactionand LNG export projects from North-West Russia for the highlyprospective LNG bunkering and natural gas vehicle markets inEurope and beyond.

The outlook for S&L is extremely positive. We expect to continuegrowing and hope to see greater demand for our activities especially in support of new commodities and projects. All theseare complex tasks, but we are condent that we have the team, thesystems and the capabilities to take them on.

Wintershall is at Home in RussiaBy Mario Mehren, Member, Wintershall Board of Executive Directors

Continues on page 10

Mario Mehren is responsible for the new Russia division

of Germanys largest producer of crude oil and natural

gas, Wintershall. In the interview below, he talks to Blue

Fuel about the importance and success of the companys

activities in Russia. In 2006, he became Vice President of

nance and information at German company Wintershall

Holding GmbH, responsible for the Finance & Russia

Board department. In October 2011, he was made a

member of the Board of Executive Directors, where he

is responsible for all the companys Russian activities.

Prior to all this, Mehren worked for Wintershalls parent

company BASF for many years. He has a graduate degree

in business from Saarland University.


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We have been working closely together

with our Russian partners Gazprom andLukoil for more than 20 years. During thislong period our activities have evolved intocomprehensive cooperation along the entirevalue added chain: from upstream explorationand natural gas production in West Siberiato transport and sales in Germany and otherEuropean countries.

Today our Russian projects make a substantialcontribution to Wintershalls nancial success.Last year in particular represented a truemilestone in our German-Russian cooperation:

we brought the Nord Stream pipeline onstream together and signed the agreement toparticipate in the South Stream pipeline, as wellas the agreement on the planned asset swapwith Gazprom.

Blue Fuel: Where is this division based and

how did you come to join it?

MM: The Russia division, with its excellentteam, is based in Moscow; this makes senseto ensure geographical proximity to itsactivities and partners.

As far as my role is concerned, I have been

closely involved in many of our current projectsfor many years, partly owing to my previouswork in the "Finance & Russia" division andmy regular business trips to Russia, and partlybecause I am a member of the supervisoryboard of Wintershalls Russian joint ventures.I was also involved in the recent expansion ofits cooperation with Gazprom.

Blue Fuel: Which Russian joint ventures

are Wintershall involved in and what is the

basis of these partnerships?

MM: We have several joint ventures with

Gazprom and other Russian companies. Ouroldest one is Wolgodeminoil: there, we havebeen exploring and producing crude oil nearVolgograd with Lukoil for 20 years.

In 2003 we founded the joint ventureAchimgaz so that together with Gazprom wecould produce natural gas in the Achimovformation of the Urengoy reserve in WestSiberia. Then, we also began cooperating withGazprom in 2007 in the West Siberian naturalgas deposit Yuzhno Russkoye. Additionally,

just recently we agreed to develop another two

blocks together with Gazprom.In all three projects we work hand in handwith our Russian partners. The often extremeclimate and the complexity of the rockformations there require both the experienceand know-how of the Russian staff and thegeological and technological expertise of theWintershall staff a perfect and successfulpartnership which is characterized byteamwork, trust and respect on both sides.

Blue Fuel: Following the commissioning

of the rst line of Nord Stream, Wintershall

has now started another major projecttogether with Gazprom: a shareholding

in South Stream. What does this new

pipeline project mean for Wintershall and

its partnership with Gazprom?

MM: We very much look forward to thismajor new project with Gazprom. It is furtherevidence of our long-standing and successfulcooperation based on trust. Our participationin Nord Stream has highlighted the fact that wehave unique experience in the implementationof complex pipeline projects. Wintershall has

a 15 percent shareholding in South Streamto develop the 900 kilometer-long offshoresection. We will provide technical support forthe project as well as nancial support. This isanother way in which Wintershall can make akey contribution to securing the energy supplyin southern Europe.

Blue Fuel:How is the projectprogressing , and what is the projects

current schedule?

MM: We are very optimistic. At the end ofDecember, we reached a key milestone when

Turkey agreed to the pipelines constructionthrough the Black Sea. The South Stream team iscurrently working hard to evaluate all the technicaand economic aspects of the project and compilethe project documents. The nal investmentdecision is expected at the end of 2012 on thebasis of these assessments. The planned annuacapacity of South Stream is expected to reach 63billion cubic meters. The project partners aim tobring the rst of the four lines online by the end of2015 and in this way strengthen supply securityin Southeastern Europe.

Wintershall is at Home in RussiaContinued from page 9


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It is difcult to say what time of year is best to visit gas

production sites in Western Siberia due to its formidable climate.However a group of German journalists braved the challengingweather to visit the facilities of Achimgaz a joint venturebetween Gazprom Dobycha Urengoy and Wintershall in lateFebruary. The extreme cold period in Europe and most parts ofRussia was already a thing of the past, but memories of it, andthe dramatically increased gas demands it caused, were fresh.

On the tour, reporters discussed with Achimgaz representativeshow to meet demands under these conditions it was not an easytask since gas production is both complicated and expensive.While it is vital to Europe, it requires a lot of effort and moneyto transmit natural gas through thousands of kilometers of

pipelines to households across the continent.As reporters toured the Achimgaz facilities, they learned thatdrilling is becoming increasingly difcult and costly due tochanges in geological conditions. While there was once atime when gas was located only 1,200 meters deep in theground, today the situation has changed and to nd naturalgas, extractors have to go deeper and deeper into the ground,

which is becoming more expensive. Located at a depth of about

4,000 meters, the Achimov layers are the hardest to reach inthe Urengoy eld. In order to tap them, about 90 days are spentdrilling through a very complicated trajectory.

As a Handelsblatt report noted, The fact that Gazprom andWintershall drill so deep proves how hard the Russian naturalgas giant has to strain itself in order to satisfy its energy-hungryconsumers.

Money is needed in order to develop new elds. Its spendingcan be planned only in the long term, said Sergey Vlasov,general director of Achimgaz. Vlasovs deputy from Wintershall,Ingo Neubert, added that the cost of a well is growing muchfaster than its depth. To drill twice deeper does not mean

to spend twice as much. Works are becoming much moreexpensive.

While the work is difcult, Neubert acknowledged that itis important. It is here at the gas pads currently underdevelopment that the foundations for future stable supply toEuropean consumers are laid, he said.

Achimov Gas from a 4-Kilometer Depth


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About ve years ago Vemex started exploringthe potential for natural gas as a main fuel formass transportation in the Czech Republic.At that time feasibility depended on theposition of municipalities: petrol and diesel thathad been preferred for supplying municipaltransport systems for year. As a result, Vemexhad to work hard to establish itself and the useof natural gas in local markets.

By providing a stable supply of gas toconsumers in 2009, Vemex built a solid

foundation on which to enter the Czechmarket. That year saw the local gas fuelmarket grow dramatically, resulting inexpanded fuel station networks and anincrease in the expanding number of gas-fueled motor vehicles. Gas, both ecologicallyfriendly and economically attractive, keptwinning the hearts and minds of the Czechdrivers: 23 stations were built, gas-fueledvehicle number reached 1800, and, now, yearson, annual consumption totals 8 mcm. Thisgrowth continues in 2010, with 32 stations,2500 cars, and 10 mcm gas consumedon average. The decision made by CzechFireguard service to allowed CNG cars intothe public parking facilities contributed greatlyto this growth. Before that, due to re safetyrestrictions, no car fueled by natural gas wasallowed to the park in public.

At the European Business Congress meetingthat took place in Prague in J une 2011, gas

as a motor vehicle fuel made one of the topheadlines. Both the encouraging speech byGazprom Head Mr. Alexey Miller, and the startof the Blue Corridor motor rally betweenPrague, Dresden, Wolfsburg, Berlin, and upto Greifswaldthe message was clear for usthat gas was gaining momentum. This gaveVemex courage and incentive to map outanother new business goal, for a strategicdevelopment of gas use in transport, includingboth CNG and LNG.

The agreement on strategic cooperation,signed with Lukoil almost the next day afterthe congress, was therefore a natural andexpected move. The Czech subsidiary of theRussian oil producer Lukoil, who operates fuelstations in our country, and the Gascontrol ofHavov who possesses extensive expertisein gas use, became our natural partners. Thesigned Memorandum covered cooperation indeveloping CNG pumping facilities based onLukoils stations.

We made the rst step by dening preferred

locations in August 2011, starting from thehighly industrialized Ostrava region, whichsuffers badly from pollution. Our target towns

Olomouc, Ostrava and Opava, which arelocated in the Moravian Silesia and host manyheavy industries rank as some of the mostpolluted regions of the country. The region ishome to over 8 million people, including thenearby Polish localities. All of these factors

G4T: Gas for transport in theCzech RepublicHugo Kysilka, Marketing & PR Director, VEMEX s.r.o.


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combined bad ecology, high fuel prices and densepopulation determined our choice for this remote region asa starting place.

We then faced an entirely new task gaining permission to build

a concrete gas fueling station at Ostrava-Muglinov, Bohumnskstreet. Despite the many challenges, we completed the projectin six months. Our station is equipped with Swiss Greeneldcompressor unit with up to 85-90 Nm3/h capacity and volumeof 1 680 liters. The gas we sell at this station is bought underthe long-term contract with Gazprom Export, and we settle ouraccounts with Lukoil on the same monthly basis. Presently, thestation is serving about 10 cars a day.

We will execute the same due diligence in determining futurelling station locations in Opava and Olomouc in Q2 2012. Wealready plan to create another two stations in H2 2012 nearPrague on the highways to Berlin and Munich.

The 2011 results were encouraging. That year, the CzechRepublic possessed 34 natural gas stations (compared to over6500 petrol fueling stations), and the number of vehicles wasapproximately 3250, including three in Vemexs company eet.Overall gas sales in the sector reached 12.1 mcm. A small butsignicant contribution to that number is made by the Vemex in-house fuelling facility that we installed at our ofce, for companyeet and guest cars.

Our outlook is diverse. Apart from cooperation with Lukoilalready mentioned, we are developing a variety of projectsunited by the idea to promote the natural gas in transport,raising gas consumption. Namely:

Vemex participation in the rst large-scale fuel station on thePrague-Brno highway. It will be served by the two compressorunits of 250 cm productivity, and supplied with gas on thebase of 15-years long-term contract. The station is to becommissioned in Q2 2012.

We will also be involved in the construction of corporativefueling unit for the Wienerberger brick factory, including thefollowing transfer of all company eet from diesel fuel to CNG.

We are joining efforts with the fueling station already operatingin the J inonice part of Prague that also brings marketingsupport and promoting Vemex as a CNG supplier. The ideagot another momentum after the rst eco-taxis, the three VWTouran Ecofuel on CNG, appeared in Prague in J anuary.

Vemex will participate in the tender to construct three CNGstations, announced by the Karlovy Vary region for the needsof public transport to improve environment in the towns of

Marinsk lzn, Sokolov, and Cheb. The Czech Post (esk pota) is the rst state enterprise that

has showed interest in switching all its corporate eet, 400to 500 cars, to CNG. To serve its needs, we have entereddiscussions with all fuel station operators.

And nally, LNG as a motor fuel. Compared to relativelyknown CNG, this fuel type is yet making its rst steps, but itstechnological advantages for certain segments like heavytrucks can make it more economic even compared to CNGWe conduct talks with Ferox-Chart, an established supplier ofcryo-equipment, carry out in-depth feasibility studies andare searching for partners.


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Subsidies for Renewable Power Sourcesin EU Cost Almost Fifty Billion EuroBy Ilya Zalmanov, Gazprom Export analytical team

The issues of the environment, energyefciency and lower carbon emissionshave been on the European agenda fora long time, and have led to a growinginterest in renewable energy sources.The EUs ambitious plans to cut carbonemissions to 80% by 2050 were declaredin the fundamental manifestos of theEuropean Commission. Some resultshave been reached already: in the pastdecade, renewables consumption in

Europe increased more than six-fold. Sucha signicant growth is mostly the resultof the low basis gures. Both in absolutenumbers and compared to the volumesof other energy sources consumed, theseresults are rather moderate.

However, given current technologies,renewable energy is substantially moreexpensive for power generation than fossilfuels. Therefore, power generation fromrenewables would not be viable withoutgovernment support through subsidies.

Open sources, unfortunately, do notprovide any extensive information on thescale and structure of such subsidies.This article is an attempt to estimatewhat green generation costs Europeantaxpayers, and in what way and to whatextent it distorts the fuel mix in a numberof EU countries including Germany, Italy,France, the UK, the Netherlands, CzechRepublic, Austria, Slovakia and Bulgaria.

Europes Energy Portal publishes the tariffsunder which the state grid companies of

EU countries purchase power generatedfrom renewable sources both fromcorporate and industrial producers (http://www.energy.eu/#Feedin). Unfortunately,open sources do not provide reliableinformation on the real shares ofgeneration by every type of renewable(solar, wind power, biomass etc.) for everycountry. However, we determined theshares for every single type of generation,and the weighted average amount of

subsidies per unit, for every country (seeLine 6 in the Table below) using datapublished by the European Networkof Transmission System Operatorsfor Electricity (ENTSO-E), EuropeanWind Energy Association (EWEA), andthe European Photovoltaic IndustryAssociation (EPIA) on the installedcapacity of every renewable generationtype for 2010-2011. Its worth noting thatthe weighted average amount of subsidies

signicantly exceeds electricity prices forend-users (here, we studied the group withthe highest prices, namely, householdsconsuming 3.5 MWh/year. Source: http://www.energy.eu).

Assuming that all power generatedthrough renewables is consumed withinthe country, we take the amount ofconsumption for every country in 2010and multiply by the subsidies per unitas derived above. This will result inthe aggregated amount of subsidies

assigned for supporting renewablepower generation in 2010, which

reaches almost 50 billion in the

examined count ries.

J ust imagine how many cubic meters ofnatural gas could be bought with 50 billion.

The power produced through renewableenergy sources provides for only 7% of thegross power generation in these countries.At the same time, government investmentsin renewable generation, in the form ofsubsidies, amount to an average of 34%

of the gross value of all power production.Therefore, the system established inthe EU for subsidizing renewable powergeneration results in an additionalburden for taxpayers. We estimate thatif such subsidies were abandoned, it

would relieve the tax component and

consequently reduce the whole tarif f for

the end-user by approximately 15-20%,

depending on the country.


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15

* Renewable energy sources: solar, wind, biomass. Source: BP Statistical Review of World Energy June 2011.

** We assume that all energy produced from renewable sources is consumed inside the country. Source: Europe`s Energy Portal(http://www.energy.eu/).

*** Weighted average indicator for 2010, energy sources: solar, wind, biomass; not including hydrogeneration

European Central Bank $/EURO exchange rate in 2010 - 1,3257

Under the current circumstances, the competitivenessof natural gas, including gas imported from Russia, isarticially depressed, and the fuel balance is distorted infavor of renewable energy sources, which are simply notviable without subsidies.

The protection of the environment is undoubtedly an issue ofthe highest importance. However, measures taken to reachenvironmental goals do not always bring adequate results.Huge nancial inow into renewable power generation hasnot yet brought tangible results to cut emissions. It wouldmake much more sense to invest in gas-red power plants

and the use of natural gas as the most environmentally-friendly fossil fuel, in order to gradually replace higherpolluting coal power and heat generation. The ultimateecological impact of natural gas would be comparable tothe renewable option but would cost signicantly less to

European consumers.

The crucial point is in nding the right balance betweenvarious energy sources. At the same time, this would allowus to develop new technologies that would help bring thecosts of renewable energy down, making its wide-spreadimplementation more friendly for European taxpayers.

calculations Germa

ny

Italy

France

UK

theNetherlands

Czech

Republic

Austria

Slovak

Republic

Bulgar

ia

TOTA

L

Total power generation in2010, TWh

621 298 573 381 115 86 71 27 462219

Consumption of electricityproduced of renewable

sources* in 2010, TWh**

82 25 15 22 10 3 6 1 1 164

Share of renewable sources in

the total energy production(3)=(2)/(1) 13% 8% 3% 6% 9% 3% 9% 2% 2% 7%

Average electricity prices forlarge industrial users (annual

consumption of 24GWh) in

2010, EURO/MWh

71 83 46 69 77 77 66 89 44

Gross value of power

produced, bn EURO(5)=(1)*(4) 44 25 26 26 9 7 5 2 2 146

Subsidies assigned to support

renewable generation, per

unit, EURO/MWh***

289 341 455 305 197 333 133 166 90

Gross subsidies assigned to

support the renewable

generation, bn EURO

(7)=(2)*(6) 24 8 7 7 2 1 1 0,1 0,1 49

Relation of the value of

subsidies assigned for

renewables to the value of

electricity paid byconsumers

(8)=(7)/(5) 54% 34% 26% 25% 22% 13% 18% 4% 3% 34%


16/23

16

Blue Fuel: Your role at EDF is to manage gas

development and all of Southern Europesactivit ies. EDF is known worldwide as the

leading power company in Europe, and par-

ticularly, for its expertise in nuclear power,

could you please tell us what role gas activ-

ity plays at EDF?

Bruno Lescoeur (BL): EDF is Europes largestpower producer and among one of the leadingenergy companies in the world with more than37 million clients. Our oldest market is Francewith 97 GW of generation capacity of which65% is nuclear. Over the last several decades,we have developed a worldwide standing. For

example, in the UK and the U.S. we own 8.7and 4 GW of nuclear capacity, respectively;and in China, we are developing a nuclear plantin Taishan through a JV with China GuandongNuclear Power Corp.

EDF prides itself on its balanced power mix,which allows the company to have one of thelowest carbon emissions levels among largepower producers. EDF has a strong expertisein hydroelectricity, with 439 plants in France(20 GW), as well as in oil and coal with 25.4GW globally. More recently, EDF decided

to build a coal plant in Poland with a highefciency rate that will also burn biomass.With EDF Energies Nouvelles, the Group isinvesting in renewables, which now represents3.3% of our installed capacity. Lastly, EDFsinstalled generation capacity for gas amountsto 11 GW. Our gas activity, in particular, coversall of Europe, where EDF is present on all thekey European markets via its subsidiaries:Edison in Italy, EDF Energy in the UK, and

EDF Luminus in Belgium. The EDF Group is

also active in Central and Eastern Europe withsubsidiaries notably in Poland, Hungary andSlovakia.

Our business goal for our gas sector is to offergas and electricity to consumers in a package.In 2010, EDF already sold around 12 bcm ofgas to its customers.

Also on the agenda is our goal to diversifyand further modernize our thermal electricityproduction capacity, in order to lower carbonemissions even further. EDF is developingCombined Cycle Gas Turbine (CCGT)

projects across Europe, while simultaneouslydecommissioning older, less efcient productionunits. In France, EDF commissioned 430 MWof CCGT capacity at the end of 2011 and has atargeted 930 MW is for 2012. Projects are underway in the UK and Belgium and we have set anambitious goal of 200 GW of total generationcapacity by 2020, which includes new CCGTs alover the world. In 2010, EDF used around 8 bcmof gas in its own power plants.

In order to ensure the future security of supplyto our consumers, EDF has been developingfor several years infrastructure projects(pipeline, regasication and storage), as wellas long term gas supply agreements.

Blue Fuel:What has changed in 2011 forEDFs gas activity?

BL: 2011 was a turning point for EDFs gasactivities with the realization of three majorprojects, marking the entry of the company inlarge gas projects.

Innovative Partnerships to be FoundBruno Lescoeur, Senior Executive Vice President at EDF and CEO of Edison

Bruno Lescoeur, Senior Executive VicePresident at EDF and CEO of Edison,

provides answers to questions from Blue

Fuel regarding EDFs gas development

strategy and its partnership with

Gazprom to join the offshore section of

the South Stream projectcargoes traded

by GM&T in LPG, gasoline, naphtha and

gas condensate.


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17

Firstly, we made a nal investment decision (FID) to build ourLNG terminal at Dunkirk in the North of France. The terminal,with an annual capacity of 13 bcm, is a large investment (over 1billion euros) that will boost the French regasication capacity byone-half. It will connect to both the French and Belgian markets.

Secondly, EDF reached a preliminary agreement with ourItalian partners regarding Edisons ownership. Edison isone of Europes oldest energy companies, with experienceranging from hydrocarbon E&P, power generation and gas andelectricity sales. It has 7 GW of CCGTs, out of a total of 8.7 GWof installed capacity, supplied by gas that Edison buys fromvarious companies, including Gazprom. Edison will become thedevelopment platform of EDF for gas and more general energyprojects in the Mediterranean region.

Finally, in September 2011, EDF concluded a deal withGazprom to join the offshore section of the South Streamproject. Negotiations began at the beginning of 2009 and inNovember 2009, an MoU was signed in order to allow for EDFsparticipation in the project. Another major milestone was reachedon 16 September 2011 with the signature of the shareholdersagreement in Sochi, providing EDF with a 15% participation inSouth Stream. Alongside Gazprom (50%), the Italian ENI (20%)and the German Wintershall (15%), the presence of a largeFrench energy company such as EDF reinforces the projectsEuropean dimension. South Stream is also an important partof EDFs gas strategy and strengthens EDFs position as animportant player in the European gas market.

Blue Fuel: In your view, what are the main strengths of the

South Stream project?

BL:The South Stream project is a real industrial challenge. Itrepresents more than 3 mt of steel, which will be made into fourpipelines spanning more than 900 km at a depth of more than2000 m below sea-level. It is a complicated project that onlyserious large industrial groups can achieve. Each of the fourpartners in the project is highly experienced in the realization oflarge projects. The rst of them is Gazprom, well-versed in majorEuropean gas projects. ENI, along with Gazprom, has contributedto the Blue Stream pipeline, while Wintershall has participated inNord Stream. Both projects having a signicant subsea dimension.EDF has decades of experience developing and building largeindustrial projects.

The success of the project will rely on the control of cost andtime management, thereby requiring close cooperation betweenthe companies on all levels. I have already witnessed a deepcommitment by our teams on a daily basis

and see how its leaders provide full support and backing.

Another important asset of the project is its European dimension;South Stream will strongly contribute to the reinforcement of thesecurity of supply in Europe and also stimulate and sustain the

economic development in Central and Southern Europe.Blue Fuel: How far does the cooperation between EDF and

Gazprom go?

BL: Of course the cooperation of the largest producer of gasin the world and the largest European power producer goesbeyond the construction of the offshore section of the SouthStream pipeline.

EDF and Gazprom have the ability to build a long termrelationship as both companies are very similar in terms ofsize, operational time scales, and involvement in massive,long-term projects. With the growing consumption of gas forpower generation needs, our companies have a mutual interest

in supply agreements or investments in production, in bothelectricity and gas.

The 2009 MoU foresees the signing of new long term gas supplycontracts between Gazprom and EDF. These contracts willgive EDF the access to gas resources from Russia and allowthe company to reinforce its security of supply by dealing with apartner such as Gazprom that has repeatedly proven itself as areliable leading supplier of gas to Europe.

It is, however, a difcult marketplace today, where a gas glut hasturned the economic principles upside-down and has shakenthe historical oil-indexation, making long-term gas supplyagreements difcult to sign. However, such contracts should

remain an important tool to fairly share the risk between buyersand producers, even if on a short-term basis there may be somediverging views about the value of gas. This means innovativepartnerships have to develop new long term agreements, and Iam convinced the constructive dialogue we have with Gazpromwill help us nd those innovative solutions that are mutuallybenecial and protable for our companies.

Blue Fuel: What about partnerships of EDF with other

Russian companies?

BL: Russia is obviously a key partner for EDF and thecooperation regarding nuclear has been developed all along thelast 30 years. Recently, EDF signed an agreement with Rosatomin June 2010 to cooperate in R&D and in nuclear fuel elds toexchange know-how and improve mutual understanding forexample, through visits of industrial sites in both countries. EDFand INTER RAO are also working together in the eld of energyefciency and created a 50/50 JV between EDF Fenice (100%owned by EDF) and INTER RAO in November 2009. ERDF,a 100% EDF subsidiary which manages the French electricitydistribution will soon start managing MRSK Holdings distributionnetworks in the Tomsk region.


18/23

18

Energy policies have been changing all over theworld for the last forty years in accordance withnational or regional differentiated approaches.However, it has become obvious that we are,at the beginning of this 21st Century, facing anew challenge, even if one does not detect anyimportant shift within energy markets.

The climate change and, in particular, thesuccessive natural disasters of these lastyears, have focused the public opinionaround environmental concerns and haveboosted the debate around the globalisation

of energy policies.Are we moving towards a global energy policythat would integrate the fossil resources depletionin the long run and the need to gradually adjustthe structure of the energy mix?

In either case, we should cope with the urgenttask of meeting the basic needs of more thantwo billion people deprived of the access tomodern energy. Furthermore, in the same way,the development of bio-fuels should not createtensions on food products supply and priceswhich will automatically penalize Southern

countries, the rst victims of the climate changesdespite their low contribution to greenhousegas emissions.Today, each region is workingtowards a range of specic solutions withappropriate transition periods, where fossil energyresources will coexist with renewable resources,the development of which being based on newand best environment-friendly technologies.

The challenge now appears in all its dimensionand complexity given the low performances

achieved in the implementation of the KyotoProtocol and the mitigated results of all otherfollowing summits such as the Durbanconference, which reached a minimal agreement,or the Copenhagen conference (COP15)situation, where nothing came out of the meeting.The agreement reached does not commit alldeveloped countries of Annex 1 and allow thelatter to manage their environmentpolicy at their convenience until 2020.

Natural gas, despite its low levels of emissionsand high efciency in power generation, is still

not appreciated by the legislators in consumingregions who do not encourage the replacementof obsolete coal power stations.

As far as the Algerian hydrocarbons resourcesare concerned, Algerias potential of new keydiscoveries is enormous, since the country enjoys1.6 million km of sedimentary basins and alargely under explored offshore area of at least100 000 km. Therefore Algeria will continueinvesting large amount of funds in the comingyears (more than 68 billions of US dollars overthe next ve years, and around 80% of which

will be devoted to the upstream sector). So farthe combined effect of rising crude oil pricesand technological advances in the extractionof non-conventional hydrocarbons helpedboosting interest in developing resources thatwere previously considered uneconomic, suchas oil shale and tar sands. In a similar way, newtechniques also contribute to recover more oilfrom reservoirs.

Thanks to its exports potential, Algeria willcontinue to play a key role in meeting the needs

Algerian Energy Policy: From Hydrocarbonsto a Diversified Mix of Energy

Ali Hached, Senior Advisor of the Minister of Energy and Mines (Algeria)

Ali Hached has more than 37 years of

experience in the gas and oil Industry, of

which 30 years have been dedicated to the

Algerian oil company Sonatrach. The rst

years of professional experience, between

1973 and 1978, were devoted to research

and teaching activities in Thermodynamics

and Industrial Processes in the Algerian

Institute of Petroleum


19/23



19

of consuming countries, in particular the European countries, throughlong term gas contracts. However, the energy policy of the EuropeanUnion has gone through deep changes since the adoption of the rstdirective in 1998. Faced with the willingness to modify the model thatallowed the tremendous growth of the European gas market, suppliers

can reasonably questionthe effectiveness of the approach and its consequences on theconditions for a stable and reliable supply of natural gas to Europe.

In Algeria, access to energy has always been at the heart ofgovernment concerns, as it is the guarantor of the peoples socio-economic development. This has been facilitated by the availabilityof substantial and diverse energy resources, including fossil energies.

This policy of sustainable development has resulted in successiveprograms for the electrication and distribution of natural gasoriented towards fully meeting of both urban and rural demands.This access to energy will be diversied owing to the immenserenewable energies potential, where solar energy is the majorcomponent. Future programs will increasingly rely on other formsof energy, particularly for population located in remote areas.

The evolution of the electricity penetration rate, now exceeding98%, and the gas connection rate approaching 50%, illustratethe outstanding performances achieved by the accessibilitypolicy conducted by the government on a national scale. Theimplementation of the National Model of Energy Consumptionadopted in the early 1980s, has encouraged this expansion. In thepast, the National Model appealed for the optimal valorisation ofavailable energy resources and promoted the use of natural gas andLPGs. It should be pointed out that the consumption of LPG per

capita which is one of the highest in the world has helpedreducing deforestation in Algeria.

This model is being updated to better deal with the concernsof energy conservation and environmental preservation. The

enhancement of energy efciency, which often measuresprogress and technology innovation, is a key parameter inoptimizing the national energy model.

Series of successive laws have addressed all these concernsintegrating them in a coherent energy strategy that has alwaysmade the energy sector a key driver of the countrys socio-economicdevelopment. The need to diversify energy sources and growingconcerns about environment calls for the integration of newtechnologies, in favour of the efcient and even cleaner productionand use of electricity.

Algeria intends to develop new technologies to ensure thecompetitiveness of renewable energy sources potentially available

for power generation, such as solar, wind, biomass and geothermalenergy. In Hassi RMel, a 150 MW solar/gas hybrid power plant hasbeen commissioned this year. This project is a major step in thepromotion and use of solar thermal power in Algeria andother projects are to be launched soon.

In conclusion, the world is facing the challenge of being consistentwith the objectives of economic development of both consumingregions and developing countries, and Algeria is developing apolicy which reects the desire to ensure that the necessaryinvestments to the development of energy infrastructures, andparticularly on new and renewable energy, will be implementedto the benet of future generations.

Algeria


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20

Blue Fuel:Looking ahead to the next 5-10

years, can you talk about the changing role

for natural gas in the global energy mix?

Ed Chow (EC):The direction has been clear

for quite some time. Natural gas will play agrowing role in global energy mix, not only inthe next 5-10 years, but in the next couple ofdecades or longer. This is due to increasingsupply of natural gas in different parts of theworld, favorable economics as the generalprice of energy rises, and its environmentallyfriendly characteristics.

Blue Fuel: How does the Asian appetite

for natural gas align with or di ffer from

broader trends in the global gas market?

EC: Overall natural gas demand growth

in the industrialized world is likely to bemoderate to stagnant given its relativelymature state and slower economic andpopulation growth. Consequently futurenatural gas demand, along with energygrowth in general, will almost certainlyshift to the fast developing regions of Asia.As income grows, formerly gas exportingcountries in Southeast Asia will need domesticgas production to fuel their own economiesand the environmentally favorable aspects ofnatural gas will command a premium.

What will be interesting to watch is how Asiangas market for imports will change as thedemand center moves from J apan to othercountries such as China and India. Also,gas exporting countries will focus more onnew markets in Asia, including new projectsfrom Australia and possibly Russia.

Blue Fuel: How do you anticipate the

market shaping for natural gas vehicles?

And what about other newer appl ications

for natural gas?

EC: I expect the development of naturalgas as transportation fuel to be limited to

eet vehicles operating in relatively shortdistances. Demand growth for natural gaswill remain concentrated in power generationresidential/commercial, and industrial usewhere it has natural advantages over liquidfuels and other alternatives.

Blue Fuel: Looking back at 2011:

where did you think things would

go in contrast to where they ended? What

are the implications for 2012?

EC: The biggest energy event in 2011 wasthe Fukushima nuclear disaster. Not only did

it lead to a sharp decline in nuclear powergeneration and consequently much higherthan normal oil and LNG imports for J apan,it raised serious questions about the futureof nuclear power development in othercountries. It also masked the longer termimpact of other Asian countries enteringthe global gas market, which I mentionedearlier. Whether the Fukushima effect will belong-term will be important to watch in 2012,as J apanese authorities decide whether torestart reactors shut down for inspection.

In any case, I expect that long-term interestin natural gas will stimulate investment,including exploration in new areas such asoffshore eastern Mediterranean and eastAfrica. Political uncertainty continues to affecenergy markets negatively and lead to pricevolatility, in spite of slow global economicrecovery. Examples include the Libya crisisin 2011 and Iran sanctions in 2012.

Natural Gas Growing Role in Global Energy Mi

Ed Chow, Senior Fellow, Energy and

National Security Program, Centerfor Strategic & International Studies

(CSIS), answers questions from Blue

Fuel regarding the global outlook for

natural gas


21/23



21

On 15 December 2011, the main hall of the Hofburg palace inVienna hosted the Energy for Life childrens Christmas party.This special occasion featured more than 800 children, aged 5 to12, as well as representatives from prominent European social andcultural institutions.

The ball was held under the patronage of Minister for SocialAffairs Rudolf Hundstorfer with support from Gazprom Export and

Austrian gas companies OMV, GWH and EconGas.

Pupils from the Vienna State Opera jointly opened the event withchildren from the Bratislava Conservatory Ballet School. Thelively and interesting concert program also featured performancesfrom Ich bin OK, a dance association for children with disabilities,as well as the Do-Re-Mi Childrens Chorus and the Bellarina

Dance Performance group. Loud applause accompanied theperformance of Danila Loginov, a young blind pianist from Russiawhile DJ tzi was the star guest and the favorite artist amongyoung participants.

In addition, the organizers made the event accessible to childrenwho were unable to attend in person by broadcasting it online atwww.openworld.eu.com. Thanks to this broadcast, young patientsat four regional hospitals in Lower Austria were able to watchthe concert.All the events were covered by major broadcastingcompanies (ORF, ATV, PulsTV) as well as Austrian print media(sterreich, Wiener Zeitung, Kronen Zeitung).

Christmas Ball for Children at Hofburg

Gazprom Export recently sponsored the 31st annual DecemberNights of Sviatoslav Richter international winter festival ofmusic and ne art, which was held from 2 to 29 December at

the Pushkin Museum of Fine Arts. Yuri Bashmet was the artisticdirector of the festival.

The festival, named after its founder, Sviatoslav Richter, featureda series of classical music concerts and art exhibits under thetheme, Frantic Songs: fantasyand visions.

The December Nights festival appeals to people of varyinginterests, with its celebration of acting, dancing, art andmusical achievements, all while maintaining a consistent highlevel of quality.

A Touch of Fantasy


22/23

22

At a ceremony under the auspices of theAssociation of communications and corporatemedia directors of Russia, Blue Fuel, theinformation and analysis newsletter produced byGazprom Export, has been awarded a diplomaas the Best Corporate Media 2012. Blue Fuelhas been nominated in the Best newsletter/bulletin category.

In our times, the quality of corporate media inRussia has a direct impact on the efciency of

interaction with partners and even competitors. Italso promotes loyalty and trust of the customers,as well as brand awareness and a brandspsychological appeal. One of the key propertiesof Blue Fuel, which translates into a competitiveadvantage, is its function as a debate oor.

This enables the exchange of experience,unorthodox opinions and creative concepts,which facilitates proper assessment of the newtrends in the ever-changing gas market.

Now in its fth year, the quarterly English-language Blue Fuel newsletter reaches anaudience of more than 3,000 recipients andwill now be issued in a new format, accessibleonline and on mobile devices.

The target audience embraces, above all,major players in the gas and, in a widercontext, in the energy market, as well asenergy-focused media and academia. And thisaudience is steadily growing.

The opening ceremony for thePhotographs of Russian and Soviet prize

winners of the World press photo 1955 -2010 contest and Grand Prix in Russianexhibits was held in Moscow last year on 16November 2011.

The exhibition featured more than 130 worksfrom masters of national photography andwinners of the international World PressPhoto contest from 1955 to 2010. In thisintegrated form, the exhibit documentedmajor milestones in Russian history over thepast half century, from the rst journey ofman into outer space to the radical politicaland economic changes in the late 1990sas well as notable athletic, scientic andcultural achievements.

The exhibition attracted many famousRussian photographers. Apart fromawarding commemorative diplomas toauthors and taking of a group photo of the

prize-winners present at the event, theopening program included the presentationof Grand Prix photos, a unique seriesof photographs released by the RussPress Photo cultural project sponsored byGazprom Export.

The collection included all of the featuredpieces as well as photos that have woninternational acclaim, diplomas and specialprizes, totaling 450 works with commentsand information about the photographersand the competition itself. The collectiongave a complete account of Soviet andRussian involvement in the competition.

Instant Photo Truth

Blue Fuel Receives Best Corporate

Media 2012 Award


23/23


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14 Blue Fuel Newsletter 1q 2012 MINI

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