BELARUSIAN PRESIDENT DEMANDS FAIR PRICE FOR TURNING GAS TRANSPORT NETWORK OVER TO RUSSIA

Kyiv Post, Ukraine
Nov 13 2006

MINSK, Belarus (AP) – President Alexander Lukashenko on Monday
raised the stakes in Belarus’ growing spat with Russia over natural
gas prices, saying Moscow should pay market prices if it is still
interested in taking over part of Belarus’ gas transport system.

Moscow and Minsk are at loggerheads over gas prices, with Russia
seeking to hike prices fourfold to $200 per 1,000 cubic meters – a
hike that would dramatically pinch Belarus’ inefficient Socialist-style
command economy.

Moscow, which has raised prices for several former Soviet republics,
has indicated it could compromise if Belarus hands over 50 percent
of its pipeline transporting Russian gas to western Europe.

Lukashenko, who traveled to Moscow to meet with President Vladimir
Putin last week, said the Belarusian national gas transport company,
Beltransgas, could be worth $17 billion – far more than the $800
million price Russian gas monopoly OAO Gazprom said the company
was worth.

He has said Belarus should not pay more for gas than what Ukraine
and Armenia pay. Armenia currently receives gas at $100 per 1,000
cubic meters.

"We are ready to form a joint venture with Russia," Lukashenko said.

"And since Russia is talking about supplying oil and gas to Belarus
at market prices, we will be doing this under market conditions."

Lukashenko and Putin signed a deal in 2001 setting up the joint
venture, but completion of the deal has been tied up as Gazprom has
sought to raise gas prices.

After Friday’s meeting, the Kremlin issued a statement saying that
economic ties between Russia and Belarus must be built on "mutually
beneficial terms based on market principles."