On September 19 "Latvijas Gāze" submitted a Notification on arbitration

to  Privatisation  Agency.  The  Notification  advises on initiation of

international  arbitration  court  procedure, pursuant to the terms and

conditions  of  the  Purchase  Agreement  signed  between Privatisation

Agency,  "Ruhrgas  AG"  and  "PreussenElektra AG" (now - "E.ON. Energie

AG"), and JSC "Latvijas Gāze" on April 2, 1997.

"Latvijas  Gāze"  submitted  its notification as a result of failure to

resolve,  via  negotiations,  the issue of releasing natural gas prices

for industrial consumers.

The  decision  to  initiate a court procedure has been submitted on the

basis  of a unanimous decision of the Company Supervisory Board, passed

on May 11, 2001.