BELARUS NEWS AND ANALYSIS

DATE:

23/07/2007

Belarus Misses Gas Payment Deadline, Meets Gazprom

Reuters

A delegation from Belarus flew to Moscow on Monday for urgent talks with Russian gas export monopoly Gazprom.

A delegation from Belarus flew to Moscow on Monday for urgent talks with Russian gas export monopoly Gazprom after Minsk missed a deadline to pay $500 million for gas deliveries.

"We should have paid before July 23 but haven't paid so far," a spokesman for Alexander Ozerets, the energy minister of Belarus, said after the minister flew to Moscow for talks.

"The delegation is here, at Gazprom. Talks are continuing, but we can confirm that the deadline was missed," a spokesman for the Russian company said.

Relations between Gazprom and Belarus are closely watched by market analysts and politicians since gas pricing rows between the two sides have threatened to cut flows of Russian gas to Europe several times over the past years.

Belarus is a transit route for around 20 percent of Russian gas exports, mainly to Poland and Germany. The remaining 80 percent are sent to Europe via Ukraine. Russia covers around a quarter of Europe's gas needs.

The latest pricing dispute with Belarus occurred in December 2006 after Gazprom threatened to raise prices for Belarus amid worsening political relations with Minsk.

In January, Belarus agreed to sell half its pipeline firm Beltransgas for $2.5 billion, while Gazprom said it would raise prices for Belarus to just $100 per 1,000 cubic metres, instead of the initially planned $200, from the previous $46. The deal also allowed Belarus to pay for only a half of its gas supplies from Russia for six months to avoid shocking the economy. Full payments were due to start in July.

The country has announced plans to borrow 1 billion euros ($1.38 billion) on Western markets and has also asked Russia to lend $1.5 billion.

Belarus will receive 21.5 billion cubic metres of gas from Russia this year, including 10 bcm in the first half.

Source:

http://www.javno.com/en/economy/clanak.php?id=64307