Carl Mortished, International Business Editor
Win tickets to the ATP finals
Gazprom is poised to cut gas shipments to Belarus, in a confrontation over hundreds of millions of dollars in unpaid bills that could jeopardise Central European supplies.
The Russian gas utility said that it would take steps to prevent the loss of pressure in transit pipelines when it reduces gas shipments to Beltransgaz, expected tomorrow, if Belarus fails to pay an oustanding bill of $456 million (£224.8 million).
A fifth of Russia’s gas exports to Europe pass through Belarus, creating a potential risk to supplies to Poland, Germany and Lithuania if Belarus takes gas from the pipeline without authorisation.
Gazprom sought to reassure its European customers yesterday. Ilya Kochevrin, a Gazprom spokesman, said that the company would divert gas to alternative transit routes, if necessary. “Should Belarus start illegal offtake of gas, we have a concrete plan so customers get their gas,” he said.
The Belarus dispute echoes a confrontation between Gazprom and Ukraine in January 2006, when the Russian utility cut off supplies after Ukraine refused to accept a tripling of its gas price.
Gazprom argued that it could no longer sell fuel to an independent Ukraine at subsidised rates set during the Soviet period. The stand-off was seen by many in Ukraine as an attempt to undermine the antiKremlin stance of the Government in Kiev.
Heated talks in Minsk between Gazprom and Beltransgaz officials have failed to arrive at a settlement over the unpaid gas bill. Efforts by Belarus to raise a loan through Raiffeisen Bank, of Austria, appear to have failed.
Underlying the dispute may be Gazprom’s interest in gaining control of Beltransgaz, the Belarus gas company, which operates gas pipelines on Belarussian territory. In January, Gazprom secured a deal in which it would acquire half of Beltransgaz for $2.5 billion. So far, it has paid $625 million for a 12.5 per cent stake.
According to Gazprom, the Belarus gas company owes $456 million, representing 45 per cent of the cost of gas delivered over the past six months.
After months of talks, Belarus agreed in December to an increase in its gas price from $46 to $100 per 1,000 cubic metres. However, Gazprom agreed to defer payment of $45 per 1,000 cubic metres until July 23.
The Russian utility insisted that its action was purely commercial. “Since we are a commercially driven company and a major taxpayer in Russia, our cashflows are very important,” Mr Kochevrin said. Gazprom said that it was disappointed that Belarus had failed to find a solution, suggesting that its neighbour had ample funds because the Russian utility pays transit fees of $30 million a month for gas exported across Belarus to Europe.
The risk to Central Europe’s supplies is small compared to the Ukraine crisis, according to experts, because summer gas demand is weaker.
Cheap gas has kept the Soviet-style Government of President Lukashenko in power. Although fiercely loyal to the Kremlin, Mr Lukashenko’s relationship with Russia has deteriorated over the issue of energy prices. The price offered to Belarus is a fraction of the market rate in Western Europe and Belarus appears to be behaving like the poor relation, demanding more assistance, to the embarassment and irritation of the Kremlin.
Industry sectors news at a glance. Interactive heatmap, video and podcast
Everything the Business Traveller needs to know to make a better trip
Get ready for the winter sports season, with our resort guides and snow reports
We are backing British business, what is the confidence of the nation and what businesses are succeeding?
Growing demand for energy, oil that is harder to reach and the rise of carbon dioxide emissions. We examine the energy challenge
Enjoy further reading from Travel to Fashion, Business to Sport, discover more
Shortcuts to help you find sections and articles
36-month car lease
on contract hire for
£359.99 plus VAT pm
12 months for the price of 11 and a 5% discount.
Offer ends 31/11/09
The UK's leading alternative to showroom finance.
Finance packages tailored to your needs.
Minimum loan of £15,000
Car Insurance
c£100,000 + car, bonus & bens
Lord Search & Selection
Midlands
Competitive
Barclaycard
Competitive
EVERSHEDS
London and Manchester
£80-95,000
Clay McGuire Executive Selection
Moments from Battersea Park.
For sale with Winkworth.
See your free Experian credit report beforehand
Book now & save over £100pp.
11 cool resorts, lowest prices... Early Booking offers 15 Nov.
20% off selected Azores holidays taken in October with Sunvil Discovery
Get covered on your travels with a superb range of policies at great prices. Visit InsureandGo.com
World Class Golf, Spa and preferential Beach Club. Private estate overlooking West Coast
Villas from £275 per night inclusive of Golf
Contact our advertising team for advertising and sponsorship in Times Online, The Times and The Sunday Times, or place your advertisement.
Times Online Services: Dating | Jobs | Property Search | Used Cars | Holidays | Births, Marriages, Deaths | Subscriptions | E-paper
News International associated websites: Globrix Property Search | Milkround
Copyright 2009 Times Newspapers Ltd.
This service is provided on Times Newspapers' standard Terms and Conditions. Please read our Privacy Policy.To inquire about a licence to reproduce material from Times Online, The Times or The Sunday Times, click here.This website is published by a member of the News International Group. News International Limited, 1 Virginia St, London E98 1XY, is the holding company for the News International group and is registered in England No 81701. VAT number GB 243 8054 69.