The Board of Directors has approved the revised version of Gazprom’s Dividend Policy

It was stressed that Gazprom’s dividend payout from the net income calculated under the Russian accounting standards is performed in compliance with the Russian Law.
The former Dividend Policy of Gazprom was approved by the Board of Directors in April 2001.
The Dividend Policy stipulates the following structure for distributing the net income gained over a reporting period.
Part of the net income is channeled to forming the reserve fund in accordance with the Company’s Articles of Association. The net income is used for the reserve fund replenishment until it reaches the level specified in the Articles of Association (7.3 per cent).
Part of the net income in the amount of 10 per cent is used to pay out dividends.
40 to 75 per cent of the net income is retained for the Company’s investment purposes.
The remaining part is divided in equal parts to pay dividends and to form the reserve for investment purposes.
The net income intended for the dividend payment may be adjusted for the amount of  Gazprom’s financial investment revaluation. This enables the Company to allocate the income secured by the real cash flow to the dividend and investment payments.
The Dividend Policy contains a provision on the dividend payment amounts: from 17.5  to 35 per cent of net income (provided that the reserve fund has been replenished).
The Dividend Policy doesn’t require taking into account the amount of Gazprom’s market capitalization when calculating the dividends. The dividend level is a reflection of the Company’s operating results over the past year, while the market capitalization – expectations of the investment community regarding the future financial performance.
The decision on the annual dividend distribution, as well as the amount and method is adopted by  the Shareholders Meeting on the Board of Directors recommendation. The annual dividend payments should not exceed the amount recommended by the Board of Directors.
The dividends based on the Company’s 2009 operating results (approved by the Company’s annual General Shareholders Meeting in June 2010) were calculated on Gazprom’s 2009 net income less the income received from revaluation of financial investments (largely – the shareholding in Gazprom neft owned by Gazprom) and unsecured by the real cash flow.
According to regulatory accounting documents, financial investments comprise, in particular, state and municipal securities, securities of other companies, contributions to  the charter (share) capitals of other companies (including subsidiary and associated entities).
If it is possible to define the current market value of financial investments according to the established procedure (i.e. when securities are quoted on a stock exchange), they are reflected in the accounting reports as of the end of the fiscal year at  the current market value by adjusting its evaluation (revaluation) as at the preceding reporting date. The value change versus the previous year has an impact on the net income amount, but is not secured by the real cash flow.