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Natural Gas April 04, 2019 01:30:55 AM

Belarus Fails to Secure Natural Gas Deal with Russia So Far

Anil
Mathews
OilMonster Author
Belarus is worried about the lack of progress at the bilateral talks with Russia on the price of gas to be imported by Belarus after 2019.
Belarus Fails to Secure Natural Gas Deal with Russia So Far

SEATTLE (Oil Monster): Belarus is worried about the lack of progress at the bilateral talks with Russia on the price of gas to be imported by Belarus after 2019, according to the nation's recently appointed ambassador to Russia Vladimir Semashko.

The diplomat, who was responsible for energy negotiations with Russia as the first premier until recently, said in an interview with Rossiyskaya Gazeta that the bilateral gas price protocol signed in 2017 will expire in 2019, but Minsk and Moscow are still "not sure what the new document would be [instead]".

According to the ambassador, Belarus has twice submitted its proposals to Russia's state-controlled gas monopoly Gazprom, the Energy Ministry, and the Russian government regarding the method of calculating the gas price for Belarus from 2020, however they have yet to be "coordinated".

In 2016, neighbouring former Soviet countries were locked in a bitter natural gas payment dispute, when Minsk insisted on lowering the price of Russian natural gas from $132 to $73 per 1,000 cubic metres and requested that Gazprom switch to equal netback pricing.

At the same time, in response to underpayment of multi-million for Russian gas supplies, Moscow cut its tax-free oil supplies to Belarus by more than a third. Later, the same year, Minsk settled in 2017 its $726mn debt for gas previously supplied by Gazprom.

Meanwhile, Belarus faces a new economic crisis if Minsk fails to secure full compensation from Russia for losses triggered by the latter’s new energy taxation system (the so-called tax manoeuvre), the International Monetary Fund (IMF) said in a statement in January.

According to the Belarusian finance ministry, the country’s budget revenue losses from the tax manoeuvre in 2019 alone were estimated at BYN600mn ($300mn), and that the losses might total $2bn by the end of 2024.

On December 8, a spokesperson with Belarusian President Alexander Lukashenko said in a televised interview that Minsk has already lost $3.6bn due to Russia's cut of energy subsidies to Belarus. Due to Moscow's 'tax manoeuvre' Belarus will lose extra $11bn within the next four years, the spokesperson added.

Courtesy: www.intellinews.com


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