Duma votes for Russian gas export monopoly

A law that will reinforce Gazprom’s monopoly on Russian gas exports gained preliminary approval in Russia’s lower house of parliament on Friday, in a snub to European demands for Russia to open up its pipeline network.

The bill says that Gazexport, the export arm of the state-controlled natural gas giant, should have “exclusive right to export of gas”. It was approved on first reading by 386-6, out of the 450-seat state Duma. The bill must pass through two more readings and gain presidential approval before becoming law, with a second reading set for June 28.

The European Union has been pushing for Russia to open its gas pipeline monopoly to competing suppliers since Gazprom in January briefly cut off gas to neighbouring Ukraine in a pricing dispute.

The EU has been trying to persuade Russia to ratify the Energy Charter Treaty, an international agreement designed to enforce market rules in the energy trade, which would require Russia to liberalise its market. But Russia, which has signed the treaty, is insisting that changes should be made before it will ratify it.

The European Commission on Friday said: “We respect the Russian parliament’s right to take decisions and make laws but we hope the new law will be discussed in the framework of the EU-Russia energy dialogue.”

A spokesman for Andris Piebalgs, the EU energy commissioner, declined to comment on the substance of the Gazprom proposal, but pointed out that the Commission had already made its views plain in a letter to the Russian government earlier this year. Brussels had said at the time that Gazprom?s monopoly would have to be taken into account in any regulatory review of a future bid by the group for energy assets in the EU.

Members of the pro-Kremlin United Russia party in the Duma are pushing for the law to be approved before next month’s summit of the Group of Eight industrialised nations in St Petersburg, where other countries are expected to renew the pressure on Russia. Since Russia has made energy security a key theme of its G8 presidency, other states had hoped it might concede on the pipeline issue.

“It’s clear there is growing pressure on Russia from western countries that want access to our resources and gas pipelines in order to force down world market prices for gas,” Valery Yazev, a United Russia deputy and an author of the bill, told the RIA-Novosti news agency.

The text of the bill said it would help “defend the Russian Federation’s economic interests, fulfil international obligations on gas exports” and guarantee income to the federal budget.

Alexander Medvedev, Gazprom’s deputy chief executive and head of the Gazexport arm, welcomed the bill. “It confirms the real state of things in the gas sector and the existing rules of the game,” he said.

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