BELARUS NEWS AND ANALYSIS

DATE:

30/12/2006

Belarus has gas reserves for two weeks

MOSCOW, December 30 (Itar-Tass) -- It is desirable to settle the gas issue with Belarus in the next 50 hours, and the time limit is two weeks, the president of the Russian Energy and Finance Institute, Leonid Grigoryev, said.

Belarus has about half a billion cubic metres of gas in reserve, he said in a televised interview in a news broadcast on Saturday.

It is approximately a fortieth of its consumption volume for a year. Thus, no crisis is expected there during the next two weeks. But the issue must be solved during the time, Grigoryev noted.

Gas is supplied to Europe through a separate pipeline. European consumers will not be affected, if Belarus "does not go to the export pipe". If it takes gas from the export pipe, Europe will have to use its reserves. There are large reserves. Gazprom has own storage facilities there, the expert said.

However, Europe may demand from Belarus to meet the transit obligations in accordance with the international law. The legislation is not the same for transit agreements and price contracts. A transit contract is additionally protected. It is not the same as a corporative price conflict. A transit agreement concerns third countries' interests. In accordance with all the international agreements, one may not halt transit, since it affects third countries' economy, Grigoryev said.

Seventy five dollars is not a price to cause a serious conflict. All in Europe pay five times more. Most neighbouring countries pay three-four times more.

Russia was criticised throughout the year for supplying cheap gas to its political allies. Ukraine pays two times more, and the rest even more. Now Gazprom shows that it is not political prices, the analyst noted.

What is more, such price levels may be reached inside the country in a year or two. It was discussed last autumn, with various variants of an energy strategy taken into consideration.

The world prices are not proposed to Belarus. First, the prices low for Europe are offered to the country, and second, it is future domestic prices. They are being rapidly equalised.

The epoch of cheap gas is over. Russia will need much money to develop gas repair systems, and the situation when gas is supplied to Western Europe at the price of 250 dollars and on the way some receives it at 45 dollars is not real, the expert stressed.

Source:

http://www.itar-tass.com/eng/level2.html?NewsID=11128410&PageNum=0