Foreign Ministry Backs MTS

The Foreign Ministry on Monday threw its weight behind the country's top mobile telecoms firm, Mobile TeleSystems, pledging to defend its interests in a dispute with gas-rich Turkmenistan, which had suspended its license.

MTS, part of oil-to-telecoms conglomerate Sistema, had an 85 percent share of Turkmenistan's mobile market until its license was suddenly suspended last year for reasons that the company said "were never fully justified."

"We believe it is a matter of principle that the conscientious Russian investor's interests are upheld. We will provide necessary help to MTS in the future," the Russian Foreign Ministry said in a statement.

The rebuke was issued as a response to the Turkmen Foreign Ministry's riposte to MTS last week, when Ashgabat said it had not received its fair share of the "enormous profits" generated by the operator in the country.

Last week MTS sent a letter to participants of Turkmenistan's oil and gas roadshow in Singapore, warning energy majors of the "perils" of investing in the Central Asian nation. It said its sad experience in the country should serve as a "cautionary tale" for all those doing business in Turkmenistan.

MTS said it had invested more than $188 million in Turkmenistan since 2005 and serviced more than 2.4 million customers. It had previously said it could incur total losses of about $600 million following the license suspension.

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