Russian gas export monopoly Gazprom reduced supplies to Ukraine by a quarter yesterday but pledged its exports to Europe would not be affected.

"Gazprom is a reliable gas supplier, but we cannot and won't supply gas without payment," said Gazprom spokesman Sergei Kupriyanov. He said deliveries had been reduced by 40 million cubic metres a day.

Ukraine's state energy firm, Naftogas, confirmed that supplies had been reduced, but gave a different figure of 30 mcm a day. It also said the reduction was not significant and would have no impact on consumers in Ukraine.

Gazprom OAO and its subsidiaries operate a gas pipeline system. The Company provides production of oil and oil products. It is also an exporter of gas to European countries. Its principal activities include exploration and production of gas, transportation of gas, domestic and export sale of gas, production of crude oil and gas condensate, and processing of oil, gas condensate and other hydrocarbons and sales of refined products.

Other activities primarily comprise banking, construction and media. The Company operates through six segments: Production of gas, transport, distribution, production of crude oil and gas condensate, refining and other.

Last August, the Company announced that it sold a 51 per cent interest in Gazstroydetal'. In May 2007, Mosenergo OAO increased its interest in GAO Mosenergo to 49.76 per cent.