BELARUS NEWS AND ANALYSIS

DATE:

07/08/2007

Belarus to pay rest of Russian gas debt by Wednesday morning

MINSK. Aug 7 (Interfax) - Belarus remitted another $66 million to Russian natural gas monopoly Gazprom on Tuesday and will pay off about $60 million more - the rest of its gas debt of $456.16 million - by Wednesday morning, a Belarusian Energy Ministry spokesman said.

The spokesman told Interfax that Belarus had paid a $330-million share of the debt since August 3.

Gazprom threatened to reduce gas exports to Belarus with effect from August 3 if the country failed to pay its debt for the first half of 2007 by that date but moved the deadline to August 10 after Belarus paid part of the arrears.

Belarusian First Deputy Prime Minister Vladimir Semashko said on Tuesday that Belarus would pay off the arrears earlier than August 10 and pay Gazprom in a timely fashion after that.

"We will go over to 100% payments. This will be hard for us. But the honor, dignity and reputation of our country must be above everything else," he said.

Belarusian President Alexander Lukashenko announced on August 2 that Belarus would take days to clear the $456-million debt.

The head of the Belarusian central bank, Pyotr Prokopovich, assured Lukashenko on Monday that Belarus would pay the whole debt by the end of the week.

Prokopovich said the country would take less than one month to compensate itself for the shortfall the payments would create, and that the national gold and foreign currency reserves would be no smaller by September 1 than they were as of August 1.

He said they would amount to $3.09 billion by September 1, which means they would be $1.33 billion larger than they were by the start of the year.

Prokopovich said purchases of foreign currency had boosted the reserves by $508 million.

An earlier report said $625 million that Gazprom paid in June for its 12.5% stake in Belarusian gas transmission operator Beltransgaz had been included in Belarus' gold and foreign currency reserves.

Gazprom spokesman Sergei Kupriyanov said: "There is no conflict with Belarus."

"I hope this situation will remind our Belarusian counterparts once again that one shouldn't confuse a relationship between two companies with a relationship between two countries. One should pay under commitments that are written down in contracts, and we hope that this is what our counterparts will do, while we guarantee unflinching fulfillment of our own commitments," he told Moscow radio station Ekho Moskvy.

Source:

http://www.interfax.com/3/300614/news.aspx