BELARUS NEWS AND ANALYSIS

DATE:

23/11/2006

President Lukashenko urges Russia to sell gas to Belarus at domestic rate

MINSK, November 23 (RIA Novosti) - The president of Belarus said Thursday that Belarusian companies should be able to buy Russian natural gas at prices similar to Russia's domestic level.

Russia has announced nearly a four-fold price increase to $180-$200 per 1,000 cubic meters for gas exports to Belarus as of 2007. In a bid to cushion the effect of the price rise, Belarusian President Alexander Lukashenko moved to meet Russia's demand for access to its pipelines, but demanded in exchange access to Russian deposits.

"If you [Russia] want to acquire our oil and gas pipelines, we do not object to that," Lukashenko said. "Moreover, we have made a decision to set up a joint venture between Beltransgaz [Belarus' pipeline company] and Russia, without holding a tender."

Gazprom has long sought to buy Belarus' pipelines, which pump Russian hydrocarbons to European markets, but the countries have failed to agree on the price. The assets, which could be used to pay for gas supplies, are under independent valuation.

Lukashenko said Belarus wants access to Russian oil and gas deposits, and could produce about 10 billion cu m of gas a year.

Belarus is the only post-Soviet state still paying under $50 per 1,000 cu m of Russian gas, a few dollars above Russia's domestic price level; any major price hikes are expected to deliver a severe blow to the Belarusian economy.

Lukashenko has repeatedly said gas prices should be at the same level for Belarus and Russia, which are building a Union State, envisioning a common economic, customs, and political space.

He said Russia's policy to Belarus, its strongest partner and an "outpost in the West," is inadequate.

Russia has been seeking to raise natural gas prices for its former Soviet allies to the European level, which has triggered bitter disputes with some post-Soviet states. Currently, Gazprom charges an average of around $230 per 1,000 cu m for gas exports to the EU.

Source:

http://en.rian.ru/russia/20061123/55929570.html