Lukashenko trades and bargains

Moscow reminds: “It doesn’t happen that a contract is respected only on one side”

The Russian leadership, it seems, is not yet ready to start a new gas war with Belarus. Despite the fact that Minsk’s debt for gas supplied this year alone due to non-compliance with the terms of the contract has already reached $192 million, supplies of blue fuel to the country will not be limited. Although such a measure was previously considered by Gazprom management, politically Moscow is still hesitating. “I don’t think gas supplies will be limited. I am confident that the contract will be fulfilled. I think they will pay. It doesn’t happen that a contract is respected only on one side,” Russian Deputy Prime Minister Igor Sechin said yesterday.

Belarus should switch to a pan-European gas price formula next year. For now, Gazprom supplies blue fuel to the country at a 10% discount on European prices. However, since the beginning of the year, Minsk has been paying for Russian gas at a price of $150 per thousand cubic meters, while according to the contract its cost is $169.2. Since last year, Belarus has been trying to get Russia to change the terms of the contract, but Moscow is not agreeing to new benefits going. Last week, Gazprom management sent a letter to Belarusian Deputy Prime Minister Vladimir Semashko and the head of Beltransgaz, Vladimir Mayorov, warning that gas supplies may be limited due to non-compliance with the terms of the contract. The warning was ignored: for April, Minsk again paid $150 per thousand cubic meters. As a result, Belarus' debt has already grown to $192 million, and, as Gazprom warned, at this rate it could reach $500-600 million by the end of the year.

Igor Sechin yesterday reminded the Belarusian side of the agreed arithmetic of calculations. “$150 per thousand cubic meters is the price they set for themselves. The Belarusian side must pay the contract price, which is now $169, and the average annual price will be about $180-186 per thousand cubic meters,” he said.

Meanwhile, Belarusian President Alexander Lukashenko yesterday proposed another option for paying for Russian gas, in his favorite manner transferring the financial issue into the plane of property relations. According to the Belarusian leader, he does not object to Russian companies purchasing a controlling stake in Beltransgaz. “They say: we need a controlling stake. I don't mind. If they say that they will supply gas to Belarus at domestic Russian prices on equal terms, take a controlling stake. We are not against it,” the Belarusian president said yesterday in Mogilev at a meeting with students of one of the universities. Mr. Lukashenko also agrees to the transfer to the control of a Russian company of the Mozyr Oil Refinery, 48% of which belongs to the Russian-Belarusian Slavneft. “The same goes for oil refineries: cheap oil means good conditions. But not for free. We are not against it, but for good money,” the president said. According to him, the government is ready to part with controlling stakes in enterprises, but not on the terms offered by Russian companies. “Russia wants us to give these factories away almost for free. We won’t sell anything for free,” Mr. Lukashenko said.

Experts were quite skeptical about the statements of the President of Belarus. “Serious, business proposals are not made in a conflicting tone. And yesterday's statement was exactly that. The performance is clearly aimed at a domestic audience and is not economically sound. Someday, of course, complex energy relations between countries will come to close cooperation, but for now it seems that this will happen only in the future,” believes Troika Dialog analyst Valery Nesterov.

Nevertheless, the Russian government accepted the careless pass of the President of Belarus and pretended to treat his proposal as serious. “Concerning the Mozyr oil refinery, this is a very interesting topic, but you need to know the economy seriously,” said the head of the Ministry of Energy, Sergei Shmatko, yesterday. However, the ministry is not yet ready to fully assess the prospects for the refinery’s transition to the control of Russian companies. According to Mr. Shmatko, it will be necessary to study “how attractive it is for Russian oil companies exporting oil to send oil for processing to Belarus,” because this country has very high excise taxes. “If we want to discuss the issue of investment in the economy of Belarus, then attractive conditions must be created, guarantees are needed that they will not take it away or impose additional excise taxes,” said the head of the Ministry of Energy.

Kirill MELNIKOV