BELARUS NEWS AND ANALYSIS

DATE:

24/07/2007

Belarus looking to Russia for gas debt

MINSK, Belarus, July 24 (UPI) -- Belarusian and Russian officials are likely to meet as Minsk's natural gas bill expands after Moscow hiked prices this past January.

RIA Novosti reports Prime Minister Sergei Sidorsky will visit Moscow July 30. The two sides are considering terms for a $1.5 billion loan for delivery of gas from Russia to Belarus.

Belarusian President Alexander Lukashenko fired the heads of state pipeline firm Beltransgaz, petrochemicals firm Belneftekhim and the Belarusian Oil Company for not preparing for the natural gas price increase, the Financial Times reports.

Belarus owes $450 million for natural gas this year. Russia increased prices from $46.60 per 1,000 cubic meters to $100 per 1,000 cubic meters on Jan. 1. Moscow had been selling discount priced gas to former Soviet states but is moving toward a complete market rate.

Europe, which purchases Russian gas for 25 percent of its needs, pays about $250. Belarus is also a major transit state, sending about 20 percent of Russia's gas exports to Poland and Germany, mostly. Ukraine is the other transit state and faced a similar price increase two years ago.

Belarus had been paying $55 per 1,000 cubic meters this year until June, when it was to pay the full amount and repay its debt.

Beltransgaz and Russian state-owned gas monopoly Gazprom are in talks to restructure or postpone debt servicing.

Source:

http://www.upi.com/Energy/Briefing/2007/07/24/belarus_looking_to_russia_for_gas_debt/5332/