ARMROSGAZPROM LICENSED TO CONSTRUCT HRAZDAN-5 POWER PLANT IN ARMENIA

ARKA
June 17, 2009

YEREVAN, June 17. /ARKA/. The RA Public Services Regulatory Commission
licensed the ArmRosgazprom CJSC to construct the Hrazdan-5 electric
power plant in Hrazdan, Kotayk region, Armenia.

Head of the Commission’s Legal Affairs and Licensing Department
Hamayak Amragyan reported that the license will be effective until
December 31, 2011.

"The designed capacity of the power plant is 445MW," Amiragyan said.

He stressed that the Commission pledged not to license any other legal
entity for energy-generating activities in Hrazdan "if this activity
should affect the performance of the power plant."

Amiragyan also said that Armrosgazprom pledged to submit the project
and investment scheme to the Commission.

In 2006, the RA Government and the Gazprom OJSC signed an agreement
under which ArmRosgazprom was to purchase the assets of the Hrazdan
heat and power plant for US $248.8mln to complete its construction
and modernization.

Besides, ArmRosgazprom plans to invest US $150-170mln in the power
plant.

After the power plant has been put into operation, ArmRosgazprom will
have a considerable share on the Armenia energy market and be able
to increase energy supplies to the neighboring countries.

The Hrazdan-5 program is immediately linked with the Iran-Armenia
gas main.

Under the agreement, the electric power generated by the Hrazdan-5 pl
ant will be transmitted to Iran’s energy system as a means of paying
for the Iranian gas supplied to Armenia.

The ArmRosgazprom CJSC distributes Russian natural gas in Armenia. The
country receives gas through Georgia.

The company was founded in 1997, with Gasprom holding 80% of its stock,
and the RA Government 20%.