BELARUS NEWS AND ANALYSIS

DATE:

15/08/2006

Belarus deliberately delaying gas price solution - Russia

MOSCOW, August 15 (RIA Novosti) - Belarus is artificially delaying a settlement on the price of natural gas supplies from Russia, a Kremlin official said Tuesday.

After raising gas prices for several of its other ex-Soviet neighbors, Russian state-controlled gas monopoly Gazprom said it would also pursue a European price formula for Belarus as of 2007, and offered to partially compensate for the price hikes if Belarusian gas pipeline company Beltransgaz were to sell the Russian energy giant its main gas routes.

"Belarus is under the illusion that something can change in Gazprom's position on the price of supplies to the country," the source said.

He said Russia had voiced its proposals on the price issue long ago but had received no response.

The price of gas supplies to Belarus has not changed since 2004, and currently stands at $46.68 per 1,000 cubic meters. Russia is seeking a price in the region of $180-200.

In his response to parliament's inquiry into reasons for raising the price for Belarus, Andrei Dementyev, deputy minister of industry and energy, said that the current price of $46.68 only partially compensated for spending on the extraction, storage and transportation of gas to Belarus.

"Under these conditions, keeping the current gas price means not only directly subsidizing supplies to Belarus, but also the absence of a source of investment into the development of the gas industry, and a reduction in budget revenues," he said.

Source:

http://en.rian.ru/russia/20060815/52673910.html