Gazprom reform second stage to be over before year end

The second stage of Gazprom reform is planned to be over before the end of this year, board chairman Alexei Miller told Vladimir Putin during a working meeting.

Miller recalled that the first stage, targeting management optimization of the head company, is over.

"We have now begun the second stage. It intends optimization of work of our company at the level of subsidiaries," Miller said. Now, companies are being established to specialize in only the production, transportation, keeping or distribution of gas. "We plan ending such work by the end of the year and opening the new year with a new set-up of our company," he said.

The adopted development strategy of Gazprom relies on several programs - development of the raw materials base until 2030 in particularly the Yamal peninsula, the Far Eastern and East Siberian regions; synchronization of gas production, transportation and sale.

Diversification is another direction of Gazprom reform. "We will prepare new routes of gas transportation and diversify them," Miller said.

"Together with our partners we are working out the North European gas pipeline project. It will ensure a greater reliability and stability of supply to European consumers," he added.

The project is to rely on a new principle of cooperation with foreign colleagues. "They will partake in production and Gazprom will make use of its assets along the entire chain, from production to the end consumer," Miller explained.

"Our strategy relies on the program of diversification of the end product," the Gazprom chairman of the board said.

He noted that his company is now studying the situation in the electricity sector. "We plan greater activities on this field," he said.

He also noted that oil is another speciality for Gazprom. "At the second stage of Gazprom reform we plan establishing the Gazpromoil company to handle only the production and processing of liquid hydrocarbons. Reshaping of this business and establishing a legal person on the basis of the Gazprom fields will increase the volume of production to 40 or 50 million tons," Miller said.

Vladimir Putin invited the Gazprom chief to keep under personal control the fulfillment of the goals set in the company's development strategy.

Plans should be strictly and consistently put into operation, noted the head of state.

"The pooling of efforts with Central Asian partners and steps towards integration in the European economy are an important part of development of the energy sector and, particularly, Gazprom," the president said.

He said that a greater transparency of the company, improvement of its management and make-up are the reserve for improving the quality of work of Gazprom.