LUKoil Gets Exemption From Gazprom Suspension

Gazprom is suspending purchases of gas from “independent” non-Gazprom producers in Russia. Above, a Gazprom facility in Belarus.

LUKoil struck an agreement with Gazprom to cancel the state-owned company's decision to stop accepting the independent producer's gas, a LUKoil representative told Interfax.

"LUKoil has managed to agree with Gazprom to cancel the decision to terminate gas admission. Therefore, gas from LUKoil's fields will be supplied at its previous amounts," he said.

LUKoil had received the notification from Gazprom but got the decision reversed, he said. Gazprom said it was suspending purchases of gas from "independent," non-Gazprom producers in Russia as of Monday.

"The reason is unstable demand for gas in the domestic market at the current time," Gazprom's press office said in a statement.

Gazprom said the decision to suspend gas purchases from independents would affect purchases only by the parent company, not by other Gazprom group companies.

It also would not affect transportation of independents' gas supplies to their own customers through the Gazprom-controlled unified gas supply system, it added.

The company might resume buying gas from independent producers if the situation on the market is favorable, Alexander Mikheyev, first deputy chief of the company's marketing department, said.

"We will continue the practice of buying gas from independents depending on the situation in the market," he said.

Meanwhile, Alexander Medvedev, a deputy chief executive of Gazprom, commented on the European Commission's antitrust investigation against the company.

The commission is playing a dishonest game with Gazprom, he said.

First of all, Gazprom was a pioneer of market reforms in Europe, Medvedev said. Second, the company continues to suffer from obstructed access to EU gas pipelines, and third, Gazprom adheres to the laws of the countries it operates in, he said.

Medvedev also said Gazprom might transfer $3.75 billion in retroactive payments to European customers in 2012 after cutting contractual gas prices.

(MT, Reuters)

Related articles:

Read more