BELARUS NEWS AND ANALYSIS

DATE:

15/12/2007

Gazprom considers Putin's visit to Minsk extremely important

MOSCOW, December 15 (Itar-Tass) - Gazprom considers Russian President Vladimir Putin's visit to Minsk extremely important due to the fact that both sides confirmed the earlier reached agreements on the parameters of Russian gas supplies to Belarus and gas prices.

According to Gazprom, future gas price rise is conditioned by energy pricing rules in the world.

"During the meeting, Russian President Vladimir Putin and Belarusian President Alexander Lukashenko reached the very important agreements," a Gazprom official said on Saturday.

"First of all, they confirmed the earlier reached agreements on the parameters of gas supplies and gas pricing rules," the official said.

According to the official, Gazprom buys gas to supply it to CIS and Central Asian countries. "Despite the earlier agreements on Turkmen gas price for 100 dollars for 1,000 cubic metres, in the first half of 2008 Gazprom will buy Turkmen gas for 130 U.S. dollars per 1,000 cubic metres. Russian gas supplies to Belarus will reach 119 dollars for 1,000 cubic metres."

"Thus, preferential conditions for Belarus are kept," the official added.

Russia and Belarus stressed the importance of the fulfilment of the December 31, 2006, contract between Gazprom and Beltransgaz. The contract specifies the amount of gas supplied to Belarus and carried through the Belarusian territory to Europe in 2007-2011.

"The sides affirm deeper economic integration and stress the importance of the fulfilment of bilateral accords," says a memorandum signed by Presidents Vladimir Putin and Alexander Lukashenko on Friday.

The sides also confirmed their adherence to the Treaty on the Establishment of the Union State that was signed in December 1999.

Russia will not enlarge gas prices for Belarus, President Vladimir Putin said in comments on the meeting of the Supreme State Council of the Russia-Belarus Union State.

"Gazprom will abide by the agreements reached last December and supply gas to Belarus at the agreed prices," he said. "We will not ask for prices higher than those specified by earlier contracts."

"I have been asked whether Belarus will have to pay more. Yes, it will, but these new prices have already been set by contracts. We confirmed the validity of contracts between Russia and Belarus, and we would honour our commitments although Russia would have to pay more for Central Asian gas," he said.

"Russia understands difficulties Europe and Belarus are encountering in connection with the world energy prices. We will do our best to minimise these consequences for the Belarusian economy," Putin said.

Russia and Belarus signed a contract on gas supplies to Minsk and Europe on the very last minutes of 2006.

The contract says that Russia will sell gas to Belarus at 100 dollars per 1,000 cubic metres in 2007. Next year Belarus will pay 67 percent of the European price excluding transportation costs. The rate will grow to 80 percent in 2009, 90 percent in 2010, and 100 percent in 2011.

The sides also agreed that Gazprom would repay the 50-percent stake in Beltransgaz in equal tranches within four years. The stake cost five billion U.S. dollars. The Beltransgaz transit rate has grown from 0.75 dollars to 1.45 dollars per 1,000 cubic metres carried to the distance of 100 kilometres.

Being aware of their responsibility, Russia and Belarus will continue to ensure uninterrupted energy supplies to Europe, Putin said.

"Russia's confirmation of earlier agreements on the energy supplies to Belarus is important for Europe at large," he said. "We agreed that we would fully honour not only bilateral contracts but also commitments of Russian energy transit to Europe."

"Russia and Belarus are aware of their responsibility for energy deliveries to European partners. Both countries are making a major contribution to the stabilisation of the European energy market," Putin said.

Source:

http://www.itar-tass.com/eng/level2.html?NewsID=12182975&PageNum=0