- The Washington Times - Thursday, December 28, 2006

MOSCOW (AP) — Russia’s natural-gas monopoly warned Belarus yesterday against siphoning gas from the main pipeline across its territory if the company goes ahead with a threatened Jan. 1 supply cutoff.

Minsk responded by repeating its threat to disrupt deliveries of Russian gas destined for Europe if state-controlled OAO Gazprom shuts off gas supplies meant for Belarus.

“If the Russian monopolist is going to be unconstructive in negotiations, then naturally there will be no transit contract from January 1 … We cannot pump gas through Belarus without a contract,” Belarusian Prime Minister Sergei Sidorsky said late yesterday on state television.

OAO Gazprom has demanded that Belarus buy gas at more than twice the current price next year and pay for the increase in part by ceding 50 percent of its own government-controlled pipeline operator.

The dispute echoes last year’s conflict with Ukraine, which led to brief supply shortages in some European nations after Gazprom suspended deliveries to Ukraine and accused it of siphoning gas meant for transit.

The gas war with Ukraine deepened European concerns about Russia’s reliability as an energy supplier. Gazprom spokesman Sergei Kupriyanov said the company will do everything it can to fulfill its obligations to European customers.

But the head of Gazprom’s export arm acknowledged in an interview with French daily Le Figaro that shortages could occur in Europe, even with a buildup of underground reserves in European nations and the option of increasing the flow of Russian gas through Ukraine.

Alexander Medvedev warned that “if Belarus siphons off a part of the gas destined to our European clients that crosses its territory, that gas will be missing from the system.”

“I cannot, therefore, exclude any future forced rationing of our stocks and, therefore, shortages for our clients,” he was quoted in an interview released by the newspaper yesterday ahead of publication today.

Russia supplies a quarter of Europe’s natural gas, with about 30 percent going through Belarus.

European Union Energy Commissioner Andris Piebalgs said the 25-nation bloc was “following the situation very closely since it may affect gas supplies to the European Union” and called for a swift agreement “that does not put in question gas transits to the EU.”

Eager to make an impression in Europe and mend troubled ties with Russia, Ukraine offered yesterday to help Russia supply gas to European consumers by increasing its own transit volumes if deliveries are disrupted.

Belarus now pays $47 per 1,000 cubic meters of Russian gas and was expected to use 21 billion cubic meters next year. Gazprom, which has been raising prices closer to market levels after selling gas cheaply to former Soviet republics for years, is demanding that Belarus pay $105 in 2007.

Under Gazprom’s offer, the price would gradually increase, approaching European levels in 2010, and Belarus would pay part of the cost by ceding 50 percent of Beltransgaz — giving Moscow more control over exports and domestic use.

A higher price would be a blow to Belarus’ Soviet-style state-run industries, whose financial health — and, in turn, a portion of longtime President Alexander Lukashenko’s popularity — depends on cheap gas.

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