ABB signs long-term cooperation agreement with Gazprom

Strategic alliance with Russian energy giant includes technology transfer, covers gas exploration, processing and power generation in Russia and other countries

Moscow/Zurich, September 8, 1998 - ABB, the international engineering group, today signed a wide-ranging, long-term cooperation agreement with RAO Gazprom, the Russian energy company. The agreement covers the manufacture of systems and equipment and the joint development of projects, both in Russia and in other countries, in the areas of natural gas exploration, recovery, oil and gas processing, transport and storage, environmental control, and the construction and operation of gas-fired power plants.

Göran Lindahl, ABB President and CEO, who signed the agreement on behalf of ABB at a ceremony in Moscow, said "this strategic alliance represents a further signal of our long-term commitment to be an important partner in the Russian market, which we continue to see as a key area for growth into the next century, despite the current turbulence. The agreement also highlights our ability to supply solutions along the entire energy chain, from gas exploration to power generation."
Gazprom CEO Rem Vyakhirev, who signed the agreement on behalf of Gazprom, said "the main provisions of the agreement meet Gazprom’s strategic objectives with respect to technology transfer and the set-up of equipment manufacturing needed by Gazprom in Russia. This will provide business opportunities for Russian companies acting as sub-contractors, and will help create new jobs, while at the same time maintaining high quality standards."
The agreement covers the manufacture of drilling and exploration equipment for both onshore and offshore gas wells, gas recovery systems and equipment - including the associated industrial power plants - pipelines and compressor stations - including automation and control systems - gas processing plants, development of a Gazprom gas-fired power plant program, supply of environmental control systems, and joint project financing. The agreement builds on ABB’s strong local companies in Russia, which are already active in the areas of oil and gas, power generation and industrial automation, as well as ABB’s strength in providing innovative financing. ABB also agreed to transfer technology in manufacturing and for gas turbines, and to provide training for Gazprom employees in manufacturing and general management.
Gazprom accounts for about 25 percent of total world natural gas production and controls 23.5 percent of the world’s proven gas reserves. ABB is one of the world’s leading companies in the field of oil and gas exploration and processing technology, and offers the widest range of high-efficiency, low-emission gas-fired power generation technologies in the industry.
The ABB Group serves customers worldwide in power generation, transmission, and distribution; automation; oil, gas, and petrochemicals; industrial products and contracting; financial services; and rail transportation. The Group reported orders in 1997 of $35 billion and employs about 220,000 people. (End)

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