Azerbaijan is to supply 50 percent more gas to Russia in 2012, boosting supplies to three billion cubic meters, Russian gas giant Gazprom CEO Alexei Miller said on Monday.

Gazprom and the State Oil Company of the Azerbaijan Republic (SOCAR) signed an additional agreement on Monday to a bilateral five-year gas contract on sales of Azerbaijani gas to Russia from 2010. Azerbaijan delivered two billion cubic meters in 2011.

"We are very interested in (the agreement) as it is cost effective. It is a mutually beneficial cooperation for both parties," Miller said, adding that the parties might raise annual supply volume further.

The Gazprom CEO also said cooperation with Russia was more profitable for Azerbaijan than supplying Europe.

"We can offer a suitable price and our price is more commercially viable than prices of European consumers," Miller added.