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Belarus 'to pay for Russian gas debt' within two weeks

BBC Published Jun 21, 2010 Reviewed Jul 4, 2026 ✓ Reviewed by citations.press editors
Belarus 'to pay for Russian gas debt' within two weeks
Belarus will settle its gas debts to Russia within two weeks.
Deputy Prime Minister Uladzimir Syamashka said Belarus would borrow nearly $200m (£135m) to pay its gas debt to Gazprom.
Russian President Dmitry Medvedev warned that gas supply cuts would rise 'day-by-day' to 85% if Belarus did not start paying its debts.
Gazprom CEO Alexei Miller reported that Belarus proposed to pay its gas debt with machinery, equipment, and various other products.
Russian President Dmitry Medvedev stated Gazprom can only accept debt repayments in foreign currencies, listing pies, butter, and cheese as unacceptable forms of payment.
Deputy Prime Minister Uladzimir Syamashka confirmed Belarus would borrow money to pay its gas debt within two weeks.
Deputy Prime Minister Uladzimir Syamashka said Belarus would pay $217m for transit fees and separately pay for gas.
Belarus paid gas at $150 per 1,000 cubic metres despite price increases to $169.20 in Q1 2010 and $184.80 in Q2 2010.
About a fifth of Europe’s Russian gas supplies pass through Belarus.
In 2009, a similar Russia–Ukraine dispute caused Gazprom to shut off supplies in the middle of winter, affecting millions.
Russia cut gas supplies to Ukraine in January 2006 and again in 2009, causing knock-on effects across Europe.
Deputy Prime Minister Uladzimir Syamashka said Belarus would borrow nearly $200m (£135m) demanded by Gazprom.
nearly 200 million USD · borrowed amountnearly 135 million GBP · borrowed amount Uladzimir Syamashka, Deputy Prime Minister
Uladzimir Syamashka added that Russia owed Belarus $217m (£146m) in fees for transiting gas.
nearly 217 million USD · fees owednearly 146 million GBP · fees owed Uladzimir Syamashka, Deputy Prime Minister
Russia's president ordered Gazprom to reduce supplies by 15%.
15 % · supplies reduction
Dmitry Medvedev said the supply reduction would rise to 85% if Belarus did not pay its debts.
85 % · supplies reduction if debts not paid Dmitry Medvedev, President of Russia
About a fifth of Russian gas supplies are pumped through Belarus.
about 20 % · supplies pumped through Belarus
Russia increased the price of gas supplied to Belarus from $150 per 1,000 cubic metres last year to $169.20 in Q1 2010 and $184.80 in Q2 2010.
150 USD per 1,000 cubic metres · price last year169.2 USD per 1,000 cubic metres · price Q1 2010184.8 USD per 1,000 cubic metres · price Q2 2010
Belarus has continued to pay $150 per 1,000 cubic metres.
150 USD per 1,000 cubic metres · price paid by Belarus
Russia cut gas supplies to Ukraine in January 2006 and again in January 2009.
In January 2010, a row nearly resulted in Russian oil deliveries to Belarus being halted.
The customs union deal between Belarus and Russia is due to come into force next month.
next 1 month · customs union deal to come into force

Belarus has said it will settle its gas debts to Russia within two weeks, after its eastern neighbour started cutting supplies in a dispute over payments.

Deputy Prime Minister Uladzimir Syamashka said Belarus would borrow the nearly $200m (£135m) demanded by the state-controlled gas monopoly, Gazprom.

But he added that Russia owed Belarus $217m (£146m) in fees for transiting gas via its territory to Europe.

Earlier, Russia's president ordered Gazprom to reduce supplies by 15%.

Dmitry Medvedev said this would rise "day-by-day" to 85% if Belarus did not start paying off its debts, accrued when it failed to pay increased prices.

Belarus believes the higher price it is being charged contradicts a customs union deal agreed between the two countries.

The row threatens to disrupt onward deliveries to Europe as about a fifth of its supplies of Russian gas is pumped through Belarus.

In 2009, a similar dispute between Russia and Ukraine saw Gazprom shut off supplies in the middle of winter, affecting millions of people.

Announcing that it had started to cut supplies on Monday, Gazprom chief executive Alexei Miller told Mr Medvedev that Belarus had proposed to pay the debt "with machinery, equipment and various other products".

Mr Medvedev said foreign payments could only be accepted in foreign currencies: "Gazprom cannot accept debt repayments in anything, be it pies, butter, cheese or other means of payment."

Later, Mr Syamashka told journalists that Belarus would pay within two weeks.

"We do not hide that we have problems with hard currency. Belarus has to resort to borrowing in order to make a payment on time," he said. "We will find a way - borrow money - but pay."

Mr Syamashka said a protocol would be signed at talks in Moscow on Monday "about which we will probably not agree in full, but it is important that Russia recognised the debt for the transit of Russian gas via Belarus is worth $217m".

"They will pay for transit. We will pay for gas," he added.

Belarus had previously insisted that Russia provide it with cheap oil and gas as part of a customs union deal between the two countries that is due to come into force next month.

Russia increased the price of gas supplied to Belarus from $150 per 1,000 cubic metres of gas last year, to $169.20 in the first quarter of 2010 and $184.80 in the second.

But Belarus has continued to pay at $150. Gazprom said at that rate it could owe $500m or $600m by the end of the year.

Belarus is an important part of the pipeline network which transports Russian gas supplies to Europe.

It remains heavily dependent on Russia to meet its own energy needs, and a considerable proportion of Russian oil and gas exports to Europe pass through it.

Russia and Belarus are supposed to be close allies, but have had several rows in recent years, particularly over energy supplies, correspondents say.

Russia has not been afraid to cut supplies to countries it accuses of falling behind in their payments.

In January 2006 and again in 2009, Russia cut gas supplies to Ukraine, causing knock-on effects all over Europe.

In January this year, a row nearly resulted in Russian oil deliveries to Belarus being halted.

Russia's critics have accused it of using its energy supplies as a political weapon.

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