BELARUS NEWS AND ANALYSIS

DATE:

25/12/2006

Gazprom warns clock ticking for Belarus in gas row

MOSCOW, Dec 25 (Reuters) - Russian gas giant Gazprom (GAZP.MM: Quote, Profile , Research) said on Monday the clock was ticking for Moscow's ally Belarus to accept a sharp gas price hike from the New Year or have supplies cut, Russian news agencies reported.

"The current contract on gas supplies to Belarus will expire in six days," they quoted Gazprom's chief spokesman Sergei Kupriyanov as saying.

"Belarus's negotiating position is irresponsible and puts the issue of the whole country's energy supplies under threat."

Gazprom, which has turned into one of the Kremlin's most potent tools for projecting Russian influence at home and abroad, has ordered Belarus to pay $200 per 1,000 cubic metres instead of the current $47.

Interfax news agency quoted Kupriyanov as saying Belarus could pay $80 per 1,000 cubic metres in cash and the rest with the 50-percent share in the Belarussian pipeline operator Beltransgaz.

Belarussian officials, at odds with Moscow on Beltransgaz's price, said on Sunday a joint venture with Gazprom was being delayed until early 2007.

"The price at which Gazprom sells gas to Belarus is not only subsidised, which is unacceptable for equal cooperation of two states, but is also loss-making for Gazprom because it does not cover its production and transportation costs," Kupriyanov said.

Russia cut supplies to Belarus, with which it had pledged to forge a union state, two years ago after a pricing row which also led to a small reduction of gas transit to neighbouring Poland and Germany for a few days.

Source:

http://today.reuters.com/news/articleinvesting.aspx?view=CN&storyID=2006-12-25T175145Z_01_L25145209_RTRIDST_0_RUSSIA-BELARUS-GAS.XML&rpc=66&type=qcna

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