Nord Stream: a Major EuropeanNord Stream: a Major European Infrastructure Project Infrastructure Project – Status and the Way Forward– Status and the Way Forward >>

Henning Kothe, Project Director Henning Kothe, Project Director Nord Stream AGNord Stream AG

Moscow, 27Moscow, 27thth of June of June

The 10The 10thth Russian Petroleum and Gas Congress Russian Petroleum and Gas Congress

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Meeting the Growing Need for Natural Gas Imports in the EU >

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Domestic production Existing imports Additional import requirements Nord Stream

Source: IEA World Energy Outlook, 2011 | bcm = billion cubic metres

The EU will need 211 bcm of additional gas imports by 2030

Import gap 211 bcm

626 bcm

2030

508 bcm

2009

196

156

312

103

312

Decreasing European production

Current EU gas imports

Energy Infrastructure for Europe >

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Nord Stream

> Two parallel offshore pipelines of 1,224 km through the Baltic Sea

> Transport capacity 55 bcm per year

> A direct and fixed link between Russia’s vast proven gas reserves and the European Union

Gas transported by Nord Stream can

> Provide 26 million European households with electricity and heating fuel

> Make a substantial contribution to EU climate protection goals

> Supply consumers since November 2011

Pipe Laying of both Lines of the Pipeline Completed >

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KP 675

KP 350

C6

Solita

ire

KP 1195

KP 297

KP 487

2011 May

June

July

Aug.

Sep.

Oct.

Nov.

Dec.

2012 Jan.

Feb.

March

April

May

* KP = Kilometre Point

KP 470

> Hyperbaric tie-ins Start 29 May 2012 in Finnish waters at KP 297 to be completed by end of June 2012

> De-watering of Line 2 July 2012

> Drying of Pipeline August 2012

> “Golden Welds”* Estimated to start 25 August 2012 Estimated completion: 1 September 2012

> Gas-In After completion of “Golden Welds”

Start of operations last quarter of 2012

Milestones – Line 2 takes Final Steps to Operation >

5* „Golden Weld“ = the final weld connecting the offshore and onshore parts of the pipelines

Nord Stream realised on Time – Operations started on 8 November 2011 >

> Nord Stream transports natural gas from Russia to the European Union

> Operations started on 8 November 2011

> After a ramp-up phase, Line 1 is now fully operational with a transport capacity of 27.5 bcm per year

> After completion of Line 2 in Q4 2012, capacity will be doubled to 55 bcm

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Operation of the Nord Stream Pipeline >

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Operation of the Nord Stream Pipeline >

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> Landfall Russia

Connection to the Russian gas grid via the Gryazovets-Vyborg pipeline

> Landfall Germany

Gas fed into European gas transmission system via the OPAL and NEL pipelines

> Control Centre in Zug, Switzerland

Remote monitoring and control of the pipeline system 24/7, 365 days a year

> Online data transfer from and to both landfall facilities

> Continuous evaluation of data with SCADA system*

> Monitoring of the gas flow to detect possible damage, prevent over-pressurisation and fulfil contractual gas transportation requirements

*SCADA stands for Supervisory Control and Data Acquisition

Maintenance and Inspection of the Pipeline >

> External inspection by ROV:

Visual, acoustic and electro-magnetic inspection surveys

Confirm position of pipeline on the seabed and possible damage to coating

> Internal inspection by intelligent Pipeline Inspection Gauge (PIG)

To detect deformations or material loss such as corrosion, erosion, or material defects

> Regular testing of all instruments and safety systems at both landfalls

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Remotely Operated Vehicle (ROV)

Intelligent Pipeline Inspection Gauge (PIG)

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Feasibility Study of Additional Pipelines: A Step Further Towards Greater Long-Term Energy Security for the EU >

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> EU’s gas import requirement grows continuously

– Natural gas offers economic and environmental advantages and is the EU’s fuel of choice over long term

– Production in the North Sea is in steady decline

– Substantial import gap in the EU and in Northwest Europe in particular

> Additional gas transport infrastructure is necessary:

– To provide capacities for new supplies

– To ensure diversification and operational flexibility of supply routes

Rationale for Further Investments in Transport Infrastructure to Europe >

EU energy mix – the growing demand for natural gas*

2010

2030

*Sources: Eurostat 2012; IEA World Energy Outlook, 2011

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> Nord Stream received a mandate from the Shareholders to study options to further increase gas transport capacities through the Baltic Sea

> Nord Stream will assess feasibility of 1 or 2 additional offshore pipelines, including key criteria:

– technical solutions

– route alternatives

– environment

– financing

> The study has started in May 2012 and will be completed in Q4 2012

> The launch of the new study underlines the Shareholders commitment to explore ways to enhance the EU’s long-term energy security by providing reliable and competitive natural gas supplies and diversified transportation capacities

Feasibility Study for a Nord Stream Extension >

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> Intention of the feasibility study: to assist Nord Stream's Shareholders in evaluating possible solutions

– to meet the EU’s growing need for natural gas imports over the coming decades

– to secure gas deliveries under existing contracts and enhance operational flexibility

> Findings of the feasibility study will be the basis for further decisions by the Shareholders

> The study will build on

– 40 years of Russian gas supply to Europe

– Experience gained from the successful implementation of the twin Nord Stream pipelines

– Shareholders’ own expertise in implementing and managing natural gas pipelines

Exploring Solutions to meet the Increasing Natural Gas Demand in the EU >