BELARUS NEWS AND ANALYSIS

DATE:

20/03/2007

Belarus to Charge Rent for Energy Right of Way

By Staff

(EUNN) London - Belarus President Alexander Lukashenko has signed a decree charging rent for forest land below powerlines, which also includes land on which Russian oil and gas pipelines traverse.

Belarus is a gateway to Europe for Russia's energy supplies and the Kremlin says Lukashenko's decree is in retaliation for Russia doubling the price of gas last year. Minsk had retaliated by introducing a transit fee on Russian crude going to Europe. The dispute culminated in Russia suspending oil exports to Europe.

Before Belarus imposes fees the government will first transfer those lands to operators of power lines and pipelines by August 1.

Belarus, formerly Russia's closest post-Soviet ally, expects to earn $50 million from newly introduced rents on the land under Russian-operated oil and gas pipelines.

Russian natural gas giant, Gazprom [RTS: GAZP], transports gas to Europe via the Belarusian section of the Gazprom-controlled Yamal-Europe pipeline, with a capacity of 24.8 billion cubic meters a year, and also through gas pipelines owned by Beltransgaz, the Belarusian pipeline monopoly, with a capacity of 51 billion cubic meters.

Russian crude is pumped to Germany, Poland and Ukraine through the Druzhba pipeline, with a capacity of 81 million metric tons a year, including the Belarusian section Unecha-Mozyr. Russia's Transneft [RTS: TRNF] pipeline monopoly operates the Druzhba pipeline.

Russia's energy spats with Belarus and Ukraine have undermined its reputation as a reliable energy supplier and drawn accusations of using energy as a political lever.

Source:

http://www.axcessnews.com/modules/wfsection/article.php?articleid=13261