Gas dispute in full fling
9:22, — Politics
Minsk attempts to reduce Russian gas price before the predicted rise of gas prices in Europe.
December 5, at a work meeting with chairperson of the board of gas monopoly Aleksei Miller, first Deputy Prime Minister Uladzimir Siamashka gave a special emphasis to fulfillment of the conditions of the contract signed by Gazprom and Beltransgaz on 31 December 2006. Nevertheless, a Belarusian source of Interfax reported the Belarusian part had been offered to pay $ 165 per 1 K m3 of gas in 2008. The source emphasized the Belarusian part bid $ 119.5, and remarked the talks didn’t bring to any outcome, newspaper “Vriemia Novostei” reports.
This information was denounced by Gazprom. “Gazprom has never made any offers or held talks on the gas price for Belarus,” “Vriemia Novostei” was told in the information department of the concern. “The price will be calculated on the present contract that gives the formula for the price and the algorithm for its alteration within the oncoming year.”
Afterwards first deputy prime minister, head of the board of directors of Gazprom Dmitri Medvedev emphasized the gas agreements of Russia and Belarus were firm. “According to the agreement, the current gas price for Belarus is the lowest compared to other CIS countries ($ 100 per 1 K m3); but it is to reach the average European level by 2011,” he told journalists. According to D.Medvedev, there is a comprehensive agreement with Gazprom’s Belarusian partners which gives the formula for the price and which defines the cooperation.
The agreement is known to have been signed last New Year. According to the 5-year contract, the gas price in 2008 will be calculated on the formula linked to the cost of oil products at European markets minus transport expenditures and the duties not paid in Belarus for exports. Nevertheless, a discount system will be implemented to calculate the price till 2011: first year - 33 percent, second year - 202 percent, last year - 10 percent.
As the source in Gazprom told “Vriemia Novostei,” calculations of the price for Belarus will be based on the Russian gas price for Poland. The price will be adjusted once in 4 months. Thus, the price for Minsk will change throughout the year. It would make those $ 118-120 that Belarus is so willing to have, if the Polish price made $ 260 per 1 K m3 (as it was August-November 2007). But because of the abrupt rise of oil prices in November, the gas price for Poland is expected to make more than $ 300 per 1 K m3 in the first half of 2008; later in 2008, the price can reach $ 350-360 per 1 K m3. Thus, Beltransgaz will have to pay $ 130-165 per 1 K m3 of gas in 2008.
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