Russian gas company OAO Gazprom (GAZP.RS) Wednesday said it has agreed with some European customers to incorporate spot market prices in long-term export contracts, in a move to defend its market share on the continent.

"Gazprom Export confirms that negotiations with European partners have been concluded with a mutually acceptable outcome," said an official at Gazprom Export, who asked not to be named.

In particular, spot market prices will play a role in setting the price for long-term export contracts, which traditionally have been linked to the price of oil, the official said.

Gazprom's biggest European customer E.ON Ruhrgas AG said Friday the Russian company had agreed to link prices of a "small double-digit percentage" of gas deliveries to spot market prices.

Spot prices have remained below long-term contract prices, as production of unconventional gas, such as shale gas and liquefied natural gas, has increasedat the same time demand has dropped.

State-controlled Gazprom supplies more than a quarter of Europe 's gas needs, but saw demand in Europe --its key export market--plummet last year amid an economic crisis.

The official said the agreement takes the current market conditions into account and "strengthens the competitiveness of Russian natural gas on important European markets."

"The spot market plays a certain role, and we managed to reflect this in our contracts, without changing their basic principles," he said.

European importers of Russian gas such as Germany 's E.ON Ruhrgas, Italy 's ENI SpA (E) and France 's GDF Suez (GSZ.FR) have criticized Gazprom for lack of flexibility in its long-term contracts.

Last year, the companies faced hefty fines as they imported less gas then stipulated under what are dubbed take-or-pay contracts, in which the buyer must take a minimum amount of gas or pay fines.

Gazprom declined to say how big a share of volumes will be linked to spot prices and for how long the changes will have effect.

But the link to a basket of oil products, which set the gas price with a six to nine month lag, and the take-or-pay clause will remain key principles in the contracts, the Russian company said.

Gazprom has traditionally defended the link to oil prices, as it allows it to access and predict income and plan investments. The company has delayed development of two new fields--Shtokman in the Barents Sea and Bovanenkovo on Yamal--citing low demand and depressed prices.

Analysts said the deal will have limited effect on Gazprom's finances. Moscow-based investment bank Renaissance Capital expects the changes to have less than a 1% effect on realized prices in Europe in 2010 and less than 0.5% on Gazprom's total revenues this year.

"We view the news as positive for Gazprom, as the contract changes are minimal and the risk of renegotiating contracts has receded," said analyst Alexander Burgansky.

Gazprom's share price has underperformed Russian oil companies by around 50%, partly on concerns of possible changes to European export contracts.

At 1520 GMT, Gazprom's ADRs in London were unchanged at $22.8 each.

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