Belarusian President Alexander Lukashenko has been promising for a few years to give a half in Beltransgaz to Gazprom. Yet, he still can’t say when it will happen.
Photo: Dmitry Lebedev
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Gazprom Responds to the Belarusian Presidential Elections
// Alexander Lukashenko is offered to pay for gas more
The United State
Gazprom has announced a price hike in gas for Belarus, 11 days after Belarusian President Alexander Lukashenko was re-elected for the third term. Gazprom’s CEO Alexey Miller said the price will go up in 2007 to the level, “close to European prices” from the record-low $46. The exact price will depend on the Russian gas monopolist’s possible purchase of a 50 percent stake in Beltransgaz, the company with gas pipes exporting Russian gas to Western Europe. Minsk has been offered to decide on the matter by April 30.
Alexey Miller made this offer at talks with Belarusian Energy Minister Alexander Ageev and Beltransgaz’ director general Dmitry Kazakov. Belarus enjoys the lowest gas prices, compared to other foreign states, - $46.68 for 1,000 cu. meters. The joint Ukrgaz-Energo of Gazprom and Ukraine, for example, is set to sell gas to industrial consumers in Ukraine at $110 per 1,000 cu. meters. The gas price in Western Europe averages $235 per 1,000 cu. meters. Gazprom would not name the yesterday price for Belarus it would be satisfied with, but said off the record that they can double the current price of $46.68.
A turnaround in the attitude to its closest political and economic ally is due to only one reason. Gazprom failed to obtain as half in Beltransgaz as was promised. As a matter of fact, the stake was the only Gazprom’s condition in keeping the low price for the country. Last December, when the gas price in Belarus was set for 2006 at the level of 2005, Gazprom insisted on calling the contract with Beltransgaz a market one.
It was a market contract as long as Gazprom is the sole owner of the Belarusian portion of the Yamal-Europe gas main. The land where the pipe runs was handed in a long-term lease to Gazprom. Besides that, Gazprom hoped to get 50 percent of stocks in Beltransgaz this year. Gazprom declared that “talks to set up a joint venture on the base of Beltransgaz to manage the Belarusian transit system were resumed in 2005.” Yet, it seems that they ended with nothing just like it was before.
19.7 billon cu. meters of the 40.4 billion of the total Belarusian transit is to be pumped to Europe via the pipe system of Beltransgaz this year. The transportation tariff in the network of Beltransgaz amounts to $0.75 per 1,000 cu. meters and comes to $0.46 in the Yamal-Europe route. The tariffs are the lowest in Europe.
Belarusian First Deputy Prime Minister Vladimir Semashko said late January 50 percent in Beltransgaz to Gazprom can be sold only at the market price. Yet, it became clear two years ago that Gazprom and Belarusian authorities mean different market prices. Gazprom valued the asset at $500 million while Belarus put it at $2.5 billion. The parties must have failed to come to the common evolution this time as well, as the Belarusian party would not comment on the talks yesterday.
Gazprom must have been waiting for the end of the presidential election in Belarus. Predictable as the result was, Beltransgaz and the Belarusian Energy Ministry still could have delayed the resumption of the talks saying the agencies were preparing for the election. Now Gazprom has set a tight deadline for Beltransgaz – April 30. Shareholders are to meet in Minsk today to consider the Russian offer.
Nataliya Grib, Pyotr Sapozhinkov
All the Article in Russian as of Mar. 31, 2006
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