Gazprom ready to talk 2021 gas supply with Belarus subject to 2020 deal 'compliance'

London — Russia's Gazprom said June 8 it was prepared to begin talks with Belarus over gas supply to its western neighbor Belarus in 2021 provided that Minsk fulfils the terms of the current year's agreement.

Moscow and Minsk have had regular disagreements over the terms of Russian gas supply to Belarus over the past two decades, with disputes leading to interruptions to deliveries in 2004 and 2010.

Gazprom and Belarus signed an agreement on gas supply and transit for 2020 at the end of December, but only agreed on the pricing element of the contract in mid-February.

Now, Belarus has requested that discussions resume over the terms of 2020 pricing, citing disagreements over the calorific value of Russian gas.

However, Gazprom -- which claims Belarus also owes it some $166 million in unpaid gas bills -- seems to be standing firm.

"The price terms of gas supply to the end of this year were agreed on February 14, 2020," it said.

"Subject to full compliance by Belarus with the agreements reached in 2020, Gazprom confirms its readiness to start negotiations on the terms of gas supply from January 1, 2021," it said.

Belarus has denied it owes any money to Gazprom and has asked for new information regarding the cost of Russian gas.

Methodology request

According to news agency Belta, the Belarus energy ministry wants Gazprom's subsidiary in the country, Gazprom Transgaz Belarus, to provide a methodology for determining the monthly calorific value of Russian gas deliveries.

"Disagreements on determining the cost of gas taking into account its calorific value have arisen," the ministry said.

It added that it would be able to quickly review the methodology once received.

Belarus is Gazprom's third biggest gas consumer after Germany and Italy, with supplies last year totaling 20.26 Bcm, according to official data.

According to media reports, Gazprom agreed to supply 20-22 Bcm of gas in 2020 at a price of $127/1,000 cu m -- the equivalent of a little under Eur10/MWh.

However, European spot gas prices have plunged in 2020 due to oversupply and weak demand, with TTF day-ahead prices having fallen to as low as Eur3.10/MWh in recent weeks.