GAS EXPORT AND ENHANCING RELIABILITY OF GAS SUPPLY TO EUROPE St. - - PowerPoint PPT Presentation

• St. Petersburg, June 18, 2019

GAS EXPORT AND ENHANCING RELIABILITY OF GAS SUPPLY TO EUROPE

Volume and average price* of Gazprom Group’s gas exports beyond former Soviet Union (FSU)** Volume and average price* of Gazprom Group’s gas exports in FSU

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Gross revenue* from gas sales beyond FSU Gross revenue* from gas sales in FSU

* Inclusive of excise tax and customs duties ** Gas supplies (including LNG) to foreign countries, except for FSU, under contracts of Gazprom Export and other companies of Gazprom Group *** Based on yearly average exchange rate of USD

GAS SALES BY GAZPROM GROUP

56.7 70.2 81.7 66.1 59.4 48.1 40.3 33.2 35.0 38.1

6,411 7,039 8,509 9,490 8,500 10,116 11,911 10,263 9,237 10,226 20 40 60 80 100 120 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 RUB/1,000 m3 bln m3

148.3 148.1 156.6 151.0 174.3 159.4 184.4 228.3 242 243.3

9,414 9,167 11,259 11,970 12,138 13,487 15,057 11,763 11,671 15,500 50 100 150 200 250 300 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 RUB/1,000 m3 bln m3

1,396 1,358 1,764 1,807 2,116 2,150 2,777 2,686 2,824 3,770 44.0 44.7 60.0 58.1 66.3 55.7 45.3 40.2 48.4 59.9

20 40 60 80 100 120 500 1000 1500 2000 2500 3000 3500 4000 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 RUB bln USD bln

363 494 695 627 505 486 480 341 323 390 11.4 16.2 23.6 20.2 15.8 12.6 7.8 5.1 5.5 6.2

5 10 15 20 25 30 35 250 500 750 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 RUB bln USD bln Gross revenue from sales, RUB bln Estimated currency proceeds, USD bln (right axis)*** Exports volume, bln m3 Average selling price, RUB/1,000 m3 (right axis)

0.2 0.3 0.4 0.5 1.3 1.7 1.8 2.1 2.6 2.8 3.2 3.3 5.1 6.5 7.7 7.9 9.9 12.3 12.9 14.3 22.8 24.0 58.5

10 20 30 40 50 60 70

Босния и Герцеговина Македония Швейцария Словения Румыния Дания Бельгия Сербия Финляндия Хорватия Болгария Греция Словакия Чехия Венгрия Нидерланды Польша Австрия Франция Великобритания Италия Турция Германия

Germany Turkey Italy UK France Austria Poland Netherlands Hungary Czech Republic Slovakia Greece Bulgaria Croatia Finland Serbia Belgium Denmark Romania Slovenia Switzerland Macedonia Bosnia and Herzegovina

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• Total supplies

in 2018 reached 201.9 bln m3*

• Increase of

7.5 bln m3 (+3.9%) from previous year

• Total supplies

in 2019 expected to range from 194 to 204 bln m3

bln m3

* According to management reports of Gazprom Export

GAZPROM GROUP’S GAS SALES BEYOND FSU IN 2018

(UNDER CONTRACTS OF GAZPROM EXPORT AND GAZPROM SCHWEIZ AG)

* Here and below, data displayed in chart may be different due to rounding

0.04 0.04 0.3 0.4 1.0 1.3 1.4 1.8 2.7 3.0 6.2 20.0

5 10 15 20 Южная Осетия Грузия Кыргызстан Эстония Азербайджан Латвия Литва Армения Украина Молдова Казахстан Беларусь

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Gazprom’s gas sales in FSU totaled 38.1 bln m3* in 2018

GAZPROM GROUP’S GAS SALES TO FSU IN 2018

bln m3

* According to consolidated financial statements of Gazprom prepared under IFRS

Kyrgyzstan

Belarus Kazakhstan Moldova Ukraine Armenia Lithuania Latvia Azerbaijan Estonia Kyrgyzstan Georgia South Ossetia

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Gazprom Group’s share* in European gas consumption Gazprom Group’s* share in European gas imports**

* Gas sales to European countries beyond FSU under contracts of Gazprom Export and GAZPROM Schweiz AG ** Difference between consumption and indigenous production

Gas supplies to Europe by major exporters and producers, bln m3

583 598 564 602 551 542 540 486 507 542 569 549 150.5 158.8 140.6 138.6 150.3 139.9 162.7 147.6 159.4 179.3 194.4 201.9 26% 27% 25% 23% 27% 26% 30% 30% 31% 33% 34% 37% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Gas consumption, bln m3 Gas sales by Gazprom Group*, bln m3 Gazprom Group's* gas share 194.4 134.8 49.4 45.0 39.5 24.1 12.6 9.6 6.8 0.1 4.8 2.6 1.8 4.1 1.3 201.9 130.8 48.5 43.6 35.7 23.4 13.1 8.1 7.8 7.0 4.6 3.7 3.6 2.6 2.2 Gazprom* Norway Algeria UK Netherlands Qatar Nigeria Iran Azerbaijan Yamal LNG Libya USA Trinidad and Tobago Peru Others 2017 2018 271 273 257 291 262 252 258 217 243 281 305 295 150.5 158.8 140.6 138.6 150.3 139.9 162.7 147.6 159.4 179.3 194.4 201.9 56% 58% 55% 48% 57% 56% 63% 68% 66% 64% 64% 68% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Import needs, bln m3 Gas sales by Gazprom Group*, bln m3 Gazprom Group's* gas share

PIVOTAL ROLE OF GAZPROM GROUP’S GAS IN EUROPEAN MARKET

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Independent industry experts from Platts Analytics predict that in the medium term Russian gas supplies will help offset declining production from Groningen field and Norway’s supply limitations.

* UK, France, Belgium, Netherlands, Germany, Denmark, Sweden, Luxembourg, Switzerland Source: Platts Analytics

Medium-term supply forecast for northwestern Europe 100 200 300

mln m3/day Norway Indigenous production Russia LNG

GAS SUPPLIES TO NORTHWESTERN EUROPE*

UNDERGROUND GAS STORAGE: ENSURING STABLE, RELIABLE AND FLEXIBLE SUPPLIES

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UGS facility UGS characteristics as of December 31, 2018 Working capacity, bln m3 Maximum withdrawal rate, mln m3/day* Long-term reservations Haidach 1.9 18.9 Rehden 0.5 10 Katharina 0.3 23.2 Banatski Dvor 0.2 2.5 Damborice 0.3 4.5 Bergermeer 1.8 26.1 OVERALL 5.0 85.2 including short-term reservations 1.0 40.6 TOTAL 6.0 125.8

• Katharina UGS facility had 6 operational caverns; its working capacity and maximum daily deliverability amounted to 317.4 mln m3 and

23.2 mln m3 in 2018.

• In 2018, working capacity of Damborice UGS facility was increased to 257.6 mln m3, raising its maximum daily deliverability to 5.0 mln m3.
• On June 16, 2018, Memorandum of Understanding was signed with Srbijagas as part of Banatski Dvor UGS expansion project in
• rder to increase its working capacity to 750 mln m3. It is planned to achieve design capacity by 2022, with maximum daily

deliverability reaching 10 mln m3.

2.7 4.6 4.7 4.8 4.9 5.0

0,0 1,0 2,0 3,0 4,0 5,0 6,0 2013 2014 2015 2016 2017 2018

bln m3

Working capacity of UGS facilities owned by Gazprom Export from 2013 to 2018

6.0 5.0 4.0 3.0 2.0 1.0 0.0

* Maximum withdrawal rate under contract, with completely filled UGS facility

NORD STREAM 2

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Nord Stream 2 project envisages construction of gas pipeline with annual capacity of 55 bln m3 and total length exceeding 1,200 km from Russia to Germany across Baltic Sea. By now, 58% of gas pipeline has been built. Nord Stream 2 will help enhance reliability of Russian gas supplies to Europe.

Sweden Estonia Russia Latvia Lithuania Russia Poland Denmark

Pipeline segments already built Line A Line B Line A Line B Nord Stream 2 – projected route

TURKSTREAM

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• TurkStream project envisages construction of export gas pipeline

stretching across Black Sea from Russia to Turkey and further to Turkey’s border with neighboring countries

• Intergovernmental Agreement signed by Russia and Turkey on

October 10, 2016, set out legal framework for TurkStream project

• TurkStream’s offshore section is being built by South Stream

Transport B.V., while joint design company TurkAkim Gaz Tasima A.S. is responsible for onshore transit section located in Turkey

• First string of gas pipeline (15.75 bln m3 in capacity) is intended

for Turkish consumers, whereas second string (with same capacity) will deliver gas to European Union

• In November 2018, deep-water pipelaying operations were

completed at pipeline’s offshore section ahead of schedule, and coastal sections were connected to deep-water section in Russian and Turkish waters in Q1 2019

• It is planned to bring TurkStream into operation before late 2019

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