Address to Shareholders

Chairman of the Gazprom Board of Directors Viktor Zubkov

Chairman of Gazprom's Management Committee Alexey Miller

Dear Shareholders!

Continuous progress is an important distinctive feature of Gazprom. By implementing new ambitious projects, entering new markets, launching new products, and introducing new technologies Gazprom confidently maintains its position at the vanguard of the global energy industry, building a foundation for sustained success over the coming decades.

This is vividly illustrated by the Company’s performance in 2014.

By signing the largest contract for the supply of natural gas in the history of the Russian gas sector Gazprom has made a spectacular breakthrough to the East. This milestone contract allowed Gazprom to penetrate the fast-growing and most promising Chinese market. The signing of the 30-year contract for over 1 tcm of gas to be supplied by the Company to Chinese consumers along the “eastern” route, launched the world’s largest investment project.

The project to launch the Yakutsk gas production centre, with its huge natural gas reserves, is fully on track. Construction is in full swing on the Power of Siberia pipeline, a key element of the gas supply system in Russia’s east and the natural gas artery of the “eastern” route. All these projects provide a huge boost to the social and economic development of Russia’s eastern regions and a platform to radically expand gas infrastructure coverage of these areas and create thousands of new jobs.

Given the huge size of the Chinese energy market, Gazprom Group is contemplating launching another, “western” route for its gas supplies to China.

Timely measures have been taken to significantly reduce transit risks and improve the reliability of gas supplies to Gazprom’s traditional export markets – Europe and Turkey. A project was launched to construct a new trunk pipeline under the Black Sea. The pipeline will supply 63 bcm of natural gas per annum, of which up to 47 bcm of gas will be delivered to European consumers. When completed, the project will allow the Company to fully abandon the transit route via Ukraine, which is prone to systemic risks.

Gazprom continues development of Russia’s Arctic. A new, second gas production site was commissioned at the Bovanenkovskoye field, the biggest deposit in the Yamal Peninsula, the area slated to become the flagship hub of the Russian gas sector. Innovative solutions and state-of-the-art technologies were used in this project, bringing production at the Bovanenkovskoye field to 90 bcm of natural gas annually. This volume is comparable to the aggregate volume supplied by Gazprom in the previous year to the three biggest foreign buyers of Russian natural gas – Germany, Italy and Turkey.

Pioneering the Russian Arctic shelf development, Gazprom produces oil at the Prirazlomnoye oil field, the only project for development of hydrocarbon deposits in the region. In 2014, oil from the field, a new grade called Arctic Oil, was first shipped to the global market.

Gazprom continues its large-scale programme for expansion of gas infrastructure across Russia. In 2014, the benefits of using natural gas were made available to another 236 towns and villages, to about 30 thousand households. This has made life much more comfortable for local residents, providing solutions to their everyday needs.

Gazprom Group is the biggest investor in the Russian power industry. The Company continues adding new generation capacity. In the reporting year, new state-of-the-art power units were commissioned in the Vologda Region and in Moscow. With these additions, Gazpom has fulfilled over two-thirds of its obligations to the state in terms of constructing new power generation capacity.

The Sochi 2014 Winter Olympics was one of the year’s highlights. Gazprom prides itself on its direct contribution to this magnificent sports gala. The energy and sports facilities constructed by Gazprom became an integral part of Russia’s triumphant performance at the Winter Olympics and will continue offering benefits to Russian citizens for many years to come.

Commitment to continuous growth, relentless drive for efficiency, and particular focus on innovations and best practices will continue providing a platform for Gazprom’s sustained success and increasing returns for the Company’s shareholders.