Turkmenistan, seeking higher prices for its natural gas, shut off supplies to Russia and Ukraine on Saturday, and Russia's OAO Gazprom pledged the cutoff won't affect its customers further down the line. Turkmen officials and representatives of Russia's state-owned natural-gas company Gazprom held talks Friday in Moscow on resuming the supplies to Russia, the Turkmen Foreign Ministry said. The ministry said the interruption in supplies to Russia is because of pipeline repairs and will last until Jan. 7. The ministry said the head of Gazprom will fly to Turkmenistan in early January to sign a new contract. The ministry also said that no discussions had been held with Ukrainian officials. Gazprom Deputy Chief Executive Alexander Ryazanov said Friday that the cutoff won't affect Gazprom's obligations to Russian and foreign consumers. But Mr. Ryazanov said that "under the conditions of complete termination of Turkmen gas supplies...Gazprom will not be able to compensate supplies under the Turkmen-Ukrainian contract."
Turkmenistan had said it would cut off all gas supplies to Ukraine beginning Friday due to the lack of a contract for 2005. There were no immediate signs of gas shortages in either country. Russia could meet its gas needs on its own, but the less-costly Turkmen supplies relieve Gazprom of costly investments in natural-gas field exploration and development in Siberia. Ukraine, however, gets some 45% of its natural gas from Turkmenistan and potentially could see an impact on its economy. Last month, the Turkmen national gas company said it would raise the price of natural gas for Russia and Ukraine to $60, or about €45, per 1,000 cubic meters from $44.
Turkmenistan, the second-largest natural-gas producer in the former Soviet Union after Russia, has said the price increase was connected to increased production costs and a major increase in the cost of gas-extraction equipment. The country said it planned to export 41 billion cubic meters of gas to Ukraine and Russia this year. By 2007, its annual exports are expected to reach 100 billion cubic meters. |