Russia's state-controlled gas giant Gazprom
Russia's state-controlled gas giant Gazprom - 
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BOB MOON: Another big energy company is aiming to improve its image this morning: Russia's state-controlled gas monopoly Gazprom. Marketplace's Stephen Beard is joining us from London with details. Good morning, Stephen.

STEPHEN BEARD: Good morning Bob.

MOON: So when I think of Gazprom, I think of a very big, rich corporation with a very bad image. Is that fair?

BEARD: It is certainly very big. It's the world's second-largest energy company after Exxon Mobil and the largest natural gas company in the world. It has a poor image mainly because of a series of bruising encounters with its customers, these former satellite states of the old Soviet Union: Ukraine, Belarus and Georgia.

MOON: And what do they hope to do with this image makeover?

BEARD: Well what they hope to do is change the perception in the West because what happened in these conflicts with their customers, Gazprom essentially said to these customers, 'you've got to pay double what you've paid to date or we'll cut you off.' In the case of Ukraine, they briefly cut off natural gas supplies and in the case of Belarus they briefly cut off oil supplies. This unfortunately for Gazprom affected some EU member states further down the pipeline.

MOON: Why the focus on improving their image in the West?

BEARD: Because that's where their most important customers are. These customers account for less than a third of Gazprom's output of natural gas but account for more than three-quarters of the company's revenue. They're paying the world price for the energy and they do pay, whereas the vast bulk of Gazprom's customers who live in Russia either pay nothing or very little for the gas they receive.

MOON: Stephen Beard in London, thank you.


MOON: By the way, Gazprom is reporting today that its export revenues soared 43 percent during the past year. They hit a record $37 billion in 2006 as Gazprom sold more gas at higher prices to over 20 European countries.