BELARUS NEWS AND ANALYSIS

DATE:

08/08/2007

Gazprom says Belarus pays debt, easing supply fears

MOSCOW, Aug 8 (Reuters) - Belarus has fully paid its gas debt to Moscow, Russia's gas export monopoly said on Wednesday, lifting a threat to reduce supplies to Minsk and easing fears that deliveries to Europe could be disrupted.

"We confirm that (Belarussian pipeline firm) Beltransgas has today paid the last outstanding tranche and the debt is now fully covered," a Gazprom spokeswoman said. "We have no plans to reduce supplies."

Belarus's deadline to pay a $456 million debt to Russia's Gazprom for supplies in the first half of this year expired at the end of July.

Gazprom had threatened to cut deliveries by 45 percent from Aug. 3, but Minsk won a one-week reprieve by paying part of the debt last week. Clearing the outstanding balance means a second deadline of Aug. 10 set by Gazprom now falls away.

Gazprom's threat sent jitters across Europe. It echoed previous disputes between Russia and the neighbours accross which its exports are piped, Belarus and Ukraine, which caused gas and oil supply cuts to Europe in the past three winters.

The European Commission had called on Gazprom and Belarus to reach a quick deal and has called an emergency meeting of its natural gas market experts. The meeting was cancelled after Belarus started paying off the debt.

Gazprom doubled gas prices for Belarus to $100 per 1,000 cubic metres from January, but allowed the country to pay only half the price in the first six months. It charges its European clients over $250 per 1,000 cubic metres.

Source:

http://asia.news.yahoo.com/070808/3/361vz.html