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Russia Speeds Up Adoption of Alternative Fuel Vehicles

June 16, 2008

Russia

Gorno-Altaisk today hosted a joint meeting of the Commissions for Natural and Liquefied Petroleum Gas Vehicles of the Government of the Russian Federation and the Russian Gas Society (RGS) Nonprofit Partnership. The participants addressed issues in relation to efficient interaction
between the Russian Federation constituents and Gazprom in the
expansion of natural gas utilization as a vehicle fuel in the Siberian
and Far East Federal Districts.

Budzulyak Bogdan Vladimirovich, Gazprom's Head of the Department of Gas Transportation, Underground Storage and UtilizationIn his speech Vice Chair of the Commission Bogdan Budzulyak emphasized
that international experience was convincingly proving the need for all
power branches at the federal and regional levels to get engaged in
meeting the challenge of alternative motor fuel utilization. He noted,
"Eighty countries of the world have enacted legislative acts with
direct effect and are financing state and interstate programs. The
world’s largest car builders have organized production of natural gas
vehicles.” According to him, the main stimulus for compressed gas
utilization as a vehicle fuel is its low price versus gasoline and
diesel oil. “Each cubic meter of gas used as a motor fuel enables an
NGV owner in Russia to save from 15 to 17 rubles,” (approx US$0.70)
said Bogdan Budzulyak.

The participants of the meeting emphasized that it was necessary to
speed up the adoption of the Federal Law on the Usage of Alternative
Vehicle Fuels and the Federal Vehicles Gasification Program.

Based on the meeting results it was recommended that the heads of the
Russian Federation constituents with sufficient pipeline natural gas
reserves develop and submit to regional legislative authorities draft
legislative acts regulating and stimulating utilization of natural gas
as a vehicle fuel.

In addition, it was recommended that financing mechanisms be developed
and approved for actions aimed at converting motor vehicles to natural
gas.

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