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Gazprom Lifts Threat of Belarus Supply Cut After Payment

AP
Friday, 3 Aug 2007 | 4:30 AM ET

Russia's state-controlled gas monopoly will not cut gas supplies to its former Soviet neighbor Belarus after Minsk paid a "significant part" of a $456 million gas debt before a Friday morning deadline, the national gas monopoly said.

All-night negotiations between Russia and Belarus in Gazprom's towering suburban offices yielded a deal that gives Belarus one week to pay the remaining debt in full, allaying fears of supply disruptions through key export pipes to Europe.

"Today we received a payment document, according to which Belarus paid a significant part of the debt to Gazprom," Gazprom spokesman Sergei Kuprianov said in televised comments. "Thus, we see real steps by the Belarusian side to resolve the debt problem. Today, a decision was taken not to limit supplies to Belarus. We expect full payment within a week."

Belarus pipeline operator Beltransgaz had paid $190 million (139.05 million euros), or more than 40% of the bill, the Interfax news agency reported, citing Beltransgaz.

Gazprom's threat had sparked fears Belarus could siphon gas from pipelines, taking 20% of Russia's gas exports to Europe, and rekindled bitter memories of Gazprom's past disputes with Ukraine and Belarus.

In the price fight with Ukraine, supplies to the EU dropped in the first days of 2006 as Ukraine siphoned gas from a transit pipeline after Gazprom halted direct shipments. Gazprom supplies a quarter of the gas used by Europe, and the incident drove home Europe's dependence on Russia for energy.

The current standoff grows out of a deal signed in the last minutes of 2006 that obliged Belarus to pay $100 per 1,000 cubic meters of gas, instead of $46.

The agreement allowed Minsk to pay $55 per 1,000 cubic meters for the first half of the year, but required payment of the balance of $456 million to Gazprom by July 23.

In a speech Friday to businessmen during the ASEAN regional forum in Manila, Foreign Minister Sergey Lavrov reassured his audience that Russia was a reliable energy supplier.

"I would like to stress that Russia has never violated its obligations under any contract to deliver energy," Lavrov was quoted as saying by Interfax.

Russia guaranteed energy supplies "to every country, not only friends or allies," he said.

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