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Azerbaijan May Reconsider Its Domestic Prices on Gas in 2007

Oil&Gas Materials 28 October 2006 14:56 (UTC +04:00)

At present, Azerigaz CJSC is selling gas to the population of the country two times cheaper than Azerbaijan buys it from Russia. The price on the imported gas from Russia is most likely to be raised again, therefore, the domestic prices on gas is likely to be reviewed. However, a decision on this issue will be taken by the Tariff Council of the Country, Alikhan Malikov, Chairman of Azerigaz CJSC, told, Trend reports.

At present, SOCAR (State Oil Company of Azerbaijan) is buying gas from GazExport OJSC at the price of $110 per 1.000 cubic meters. The price for the population of the country is just about $55 per 1.000 cubic meters.

In January, 2006, we could manage to collect only 16% of the cost of the gas sold. In September 2007 this indicator reached 72.4%. Massive gas interruption we carried out in August-September, of this year played its role in it as well. At the same time, despite of the fact that the winter is not far off, we continue gas interruptions in those regions where the takings will be at a low level, said Mr. Malikov.

Touching upon the gas import to Azerbaijan, Mr. Malikov pointed out that the country will continue buying the blue fuel from Russia in the future as before. However, many things will depend on the prices that the Russian party suggests. If the prices are high, the gas volumes might be reduced. In addition, the Azerbaijani Government is also negotiating with Iran on import 1.8-2 bln. cubic meters of gas per year, said the Chairman of Azerigaz.

According to the Head of Azerigaz, gasification of Aghdjabadi and Baylagan Districts of the Country is expected to take place in 2007, after that all the regions of the country will be provided with the blue fuel.

It was for the first time a few days ago when Lerik and Yardimli Districts of the Country received gas. At present, only Aghdjabadi and Baylagan Districts of Azerbaijan has remained gas free. But we will provide them with gas in next year, said Mr. Malikov.

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