BELARUS NEWS AND ANALYSIS

DATE:

02/01/2007

Gazprom and Belarus agree 11th hour deal

By Stephen McNamara

Russian gas major Gazprom and Belarus have forged an 11th hour deal for gas supply that will avoid the former Soviet state being cut off.

A dispute over the price of Gazprom gas supplies to Belarus for calendar year 2007 had left negotiations unresolved and the threat of cessation of suppliers on the cards as the new year loomed.

However, the Russian gas giant and neighboring nation have now agreed that gas will be supplied at a price of $100 per 1,000 cubic meters of gas.

"The price on natural gas [deliveries] will be $100 in cash per 1,000 cubic meters starting with the New Year and will be adjusted in the future according to a price formula in the contract," Gazprom chairman Alexei Miller said.

Over the past year Commonwealth of Independent States (CIS) countries have seen the cost of their Gazprom gas supplies increase dramatically as the Russian company has attempted to bring tariffs for neighboring states in line with the price for Europe in general.

While the newly agreed price still falls short of prices paid in western Europe, Gazprom has a policy in place to gradually increase prices for CIS customers until parity is achieved in 2011.

Source:

http://www.energy-business-review.com/article_news.asp?guid=E1CA7949-C427-4695-AE31-3CF8398C8240