E.ON and Gazprom Reach Understanding on Participation in Gas Field Exchange for Assets in Hungary

Dusseldorf (ots) - Yesterday E.ON and Gazprom signed a basic
agreement on the exchange of assets in the sectors of gas production
as well as gas sales and trading and power. E.ON is acquiring a stake
of 25 % minus one share in the Siberian gas field Yuzhno Russkoye.
Yuzhno Russkoye has reserves of over 700 billion m3, making it one of
the world's largest gas fields. Production is to start next year.
Annual output will reach up to 25 billion m3. This gas quantity is
equivalent to the annual consumption of over 10 million households.
Through the minority stake in Yuzhno Russkoye and construction of the
North European Gas Pipeline, as agreed with Gazprom and BASF, E.ON
and Gazprom are making an important contribution to strengthening
security of supply for the European gas market. Russian gas will
become even more important here in future because gas demand will
rise further, but West European production will decrease. The gas
volumes from the stake in Yuzhno Russkoye and from existing gas
fields in the North Sea amount to roughly 15 % of the gas supplies of
E.ON Ruhrgas.

In return for the stake in the field, Gazprom is receiving
minority interests of 50 % minus one share in the Hungarian gas
companies E.ON Földgaz Storage and E.ON Földgaz Trade, a stake of 25
% plus one share in the regional power and gas supplier E.ON Hungaria
and a compensation still to be quantified. In addition, E.ON and
Gazprom have agreed to work together on specific gasfired power
station projects in Europe.

E.ON and Gazprom intend to conclude a detailed agreement on the
exchange of assets by the end of the year. The envisaged Gazprom
shareholdings in Hungary are subject to approval by the EU Commission
and Hungarian authorities.

E.ON CEO Wulf H. Bernotat: "Participation in Yuzhno Russkoye
extends and deepens our long-standing partnership with Gazprom.
Against the background of rising demand we are taking precautions to
ensure that enough gas will be available in Europe in the future,
too. E.ON and Gazprom are thus making an important contribution
towards durably enhancing security of supply in Europe."

"The signing of this basic agreement is another important step in
the development of cooperation between Gazprom and foreign companies
in the gas production sector on the basis of an equivalent,
strategically attractive exchange of assets," said Alexander
Medvedev, Deputy CEO of OAO Gazprom.

Further information and charts on Yuzhno Russkoye are available on
the Internet at www.eon.com.

Originaltext: E.ON AG
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