Athens-Moscow to sign gas deal

GMT 22:21 2015 Saturday ,18 April

Arab Today, arab today Athens-Moscow to sign gas deal

Worker standing on stairs of natural gas reservoir at port of Sabetta, Russia
Athens - AFP

Athens and Moscow are set to sign a deal extending a planned gas pipeline to Greece in exchange for billions in advance payment to the cash-strapped eurozone country, a Greek official told AFP Saturday, a claim denied by the Kremlin.

Russia would make an advance payment worth billions for the extension of a new Turkish Stream pipeline to Greece, the Greek official said, confirming a report in German weekly Der Spiegel.

"A deal will be signed Tuesday in Athens with a high-level Russian delegation on the construction of the pipeline," said the Greek official on condition of anonymity.

"This agreement will set the conditions of financing the construction and level of royalty fees due," added the source.

However, the Kremlin's spokesman Dmitry Peskov told radio Business FM: "No, there is no agreement."

President Vladimir Putin meanwhile had said during Greek Prime Minister Alexis Tsipras's visit to Moscow last week that "the question of energy cooperation was raised... and will be studied by experts but Russia has not promised financial aid, simply because no one has asked for it."

Austrian daily Die Presse however said Saturday that it had obtained confirmation from a Russian source close to negotiations about the planned agreement.

According to the Spiegel report, the advance payment would amount to between 3 and 5 billion euros and would stem from royalties expected when Russian gas begins transitting through Greek territory through the pipeline.

The Greek official told AFP that such an advance is "indeed expected, and it will be an amount closer to the higher end of that cited by the Spiegel". The source added that the funds would be made available in "a short time, in the coming months".

If the deal is indeed sealed, any advance payment would be a welcome source of revenues for Greece, which has been struggling to unlock 7.2 billion euros in international bailout funds that it desperately needs.

Asked about reports of the deal, German Finance Minister Wolfgang Schaeuble said: "I am happy for Greece if that's the case."

"I don't know the details and I don't need to know them. But everything that helps Greece is good," he added.

The Turkish Stream pipeline is not expected to come into service until 2019 and Ankara and Moscow are struggling to come to a final deal.

In exchange for agreeing to host the pipeline, Turkey secured from Russia a reduction on its own gas imports of 10.25 percent, a welcome concession for a country with slowing growth and pressured currency.

Yet Russian daily Kommersant has reported in March that the final negotiations had reached a "dead end" over the pricing terms, even though Turkish Energy Minister Taner Yildiz insisted both sides were in agreement.

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