| Submit your comments on this article |
| Caucasus/Russia/Central Asia |
| Gazprom agrees gas deal with Turkmenistan |
| 2005-04-16 |
| Alexei Miller, Gazprom's chief executive officer, returned to Moscow from Turkmenistan on Friday having convinced the central Asian republic to resume the delivery of natural gas to Russia's largest energy company. Delivery was blocked 17 weeks ago following a fight over pricing. During talks at President Saparmurat Niyazov's palace in Ashkabad, the Turkmen capital, Mr Miller rejected a demand for a 30 per cent price rise. But he conceded that Gazprom would pay the full $44 per 1,000 cubic metres cost of gas in cash rather than with the previous mix of cash and barter goods. The new arrangement will last until the end of 2006, during which Turkmenistan has committed to deliver 17bn cubic metres of gas to Russia 7bn c/m this year and 10bn c/m in 2006. Nevertheless, there remains some doubt whether the deal will resolve the crisis that began on January 1 when Turkmenistan blocked gas deliveries to Russia. The wording of a Gazprom statement that Mr Miller and Mr Niyazov had "reached understanding that in future all contracts would be strictly observed, including agreements on gas prices for Russia" was similar to one issued after talks in February that failed to induce Turkmenistan to turn the gas tap back on. Turkmenistan wants to reap the benefits of record gas prices in Europe where Russia earns around $20bn (€15.4bn, £10.5bn) a year. But Gazprom is not inclined to share export outlets. State regulated gas prices in Russia fall well short of the $58 per 1,000 c/m Turkmenistan is seeking. The onset of spring, when Russian gas demand drops, weakens Turkmenistan's position. Bargaining will begin next year when talks on a larger gas contract for 2007-2028 open. Russia plans to boost imports from Turkmenistan tenfold in that period. takes a little presure off of Putin, maybe? also keeps one of the Stans in his court, more or less |
| Posted by:too true |
| #1 The NY spot price for 1000m3 natural gas is about $240. Quite a deal for the Russians. The Russians export their gas to Europe and designate the Turkmen gas for below market price Russian use. Time for a new pipeline running south. |
| Posted by: ed 2005-04-16 4:34:11 PM |