BELARUS NEWS AND ANALYSIS
DATE:
06/01/2010
Cold weather and Belarus dispute raise concerns
By Dafydd ab Iago
The first week of January has seen abnormally cold weather and a continuing oil dispute between Russia and Belarus, giving a reminder of the continuing need for increased security of energy supply. The UK's experience of a 30% increase in gas demand has raised concerns that a gas shortage could hit the country. Worries remain despite a gas balancing alert issued by the UK's National Grid later being withdrawn. Continued low temperatures in January would compound problems in the UK, formerly a net exporter of gas, due to a lack of storage capacity.
In the Baltic states, concerns were also raised as to the security of electricity supply, especially as Lithuania's Ignalina nuclear power plant was finally shut down on 31 December 2009 (1). This follows a threat, on 4 January, by Belarus' state-owned electricity company Belenergo to cut transit of electricity to Russia's Kaliningrad enclave (and Baltic countries). This is linked to suspension of heavily subsidised oil supplies to Belarus' two oil refineries. In a statement, the Lithuanian subsidiary of Russian electricity company Inte RAO noted this would make unstable the electricity system in the whole Baltic region. Talks between Belarus and Moscow were continuing, on 6 January in Moscow.
Separately, Ukraine's Energy Minister Yuriy Prodan, on 6 January, stated that state-owned Naftogaz would pay over US$890 million to Russia's Gazprom by 11 January. Russia had raised previously concerns about Ukraine's ability to pay for gas consumed in December 2009. Non-payment could lead to a repeat of Russia's cutting of gas supplies, via Ukraine, to Europe as in January 2009.
(1) Some 80% of Lithuania's electricity supply came from Ignalina.
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