THE ARAB DIMENSION OF STROYTRANSGAZ COMPANY

The engineering and construction company OAO Stroytransgaz is actively operating in both Russia and 17 other countries, including Middle East and North African countries. The cpmpany has subsidiaries and representative offices in Algeria, syria, Saudi Arabia, the UAE, in Iran, Iraq, Lebanon, Libya and Jordan. Leonid V.Bokhanovsky, first vice president of OAO Stroytransgaz, told Diplomat about the company's activities in Arab countries.

By stepping up business cooperation in the countries of the region, Stroytransgaz promotes a widening and diversification of Russia's trade and economic position abroad. The company's activities are in line with the policy of the country's leadership to futher integrate Russia into th eworld economy, widen the geographic distribution of its foreign economic and investment ties and bolster its strategic partnership with leading producers of energy resources.

Accordinfg to the appraisal of Engineering News Record (ENR), an authoritative rating agency, Stroytransgaz is the only Russian company to rank – for the second time in a row – among the world's largest engineering and construction companies working in the oil and gas sector.

While operating outside Russia, our company has acquired extensive experience in business interaction with countries of the Arab world. Major construction projects of Stroytransgaz are currently nderway in Algeria, Syria, Saudi Arabia, and in the United Arab Emirates (UAE). Virtually everywhere, Stroytransgaz is implementing projects on EPC (engineering-procurement-construction) terms, that is, on a turnkey basis.

Of the Arab countries, Algeria was the first one where Stroytransgaz launched projects. In the nearly ten years, since 1999, we have been commissioned by SONATRACH, Algeria's largest company , to implement a series of large-scale projects whose budgets were over hundreds of millions of U.S. dollars. In 2003, we completed the 403-kilometer northern section of the Haoud El-Hamra-Arzew trunk oil pipeline. Stroytransgaz has also built a gas pressure-reducing station and an end-point terminal in the Arzew oil loading port. At the close of last year, our company completed the 273-kilometer Sougueur – Hadjret Ennous gas pipeline, one of the Algeria's biggest projects having national significance. At present, Stroytransgaz is implementing yet another project in Algeria – the reconstruction of the 150-kilometer Ouled Djellal-Skikda gas pipeline.

The expirience we gained in Algeria proved useful in imp;ementing projects in Syria. In December 2005, Stroytransgaz concluded its first contracts with the Syrian Gas Company (SGC) to build oil and gas projects. As early as January 2008, our company completed (ahead of schedule) the 319-kilometer Arab Gas Pipeline.

Work on another contract with SGC, concluded in 2005, is currently in full swing: the company is developing three fields in Palmyra, a new Syrian gas production province, and is building a gas processing plant, as well as gas pipelines and related infrastructure. In the spring of the last year, yet another contract was signed with SGC, this time to construct a gas processing plant, «North Palmyra». The work is to be completed in mid-2009.

Our company's work in Sudan was also successful. In 2005, Stroytransgaz, acting as a general contracor, completed the 369-kilometer part of the Melut basin-Port Sudan. back them, Petrodar Operating Co., one of the Sudan's leading oil companies, was the client.

In 2007, our efforts to work up proposals for several projects in the Kingdom of Saudi Arabia were crowned with successs. We were awarded the first contract to construct a new 217-kilometer Sheiba-Abqaiq oil pipeline to be commissioned in October this year. Ali Al Adjmani, vice president

of saudi Aramco, the client company, characterized the relationship with Stroytransgaz as follows: « We consider Stroytransgaz to be part of our future».

Stroytransgaz continues to expand cooperation with Arab countries. On July 24, 2008, representatives of OAO Stroytransgaz and Dolphin Energy Ltd. in Abu Dhabi signes a contract on building the Taweelah-Fujairah (UAE) gas pipeline with a total length of 240 kilometers. This is the first large-scale project in the fuel-energy sector in the United Arab Emirates, in which a Russian construction company will be involved.

Furthermore, our company was asked by the Iraqi North Oil Company to inspect the Iraqi part of the Kirkuk-Banyas oil pipeline in view of the subsequent reconstruction work on the entire system.

The National Iranian Gas Company invited Stroytransgaz to cooperate in building underground gas storage facilities.

Stroytransgaz has now created a solid base for its presence in the region: highly skilled professionals, construction machinery and equipment, production facilities, and extensive practical experience.