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Russia, Turkmen leaders meet, no word on gas

Published 11/29/2009, 07:22 AM
Updated 11/29/2009, 07:24 AM

* Medvedev to travel to Turkmenistan at end of December

* Turkmenistan keen to restart supplies as budget suffers

* Gazprom wants to cut purchases five-fold in 2010-2012

ZAVIDOVO, Russia, Nov 29 (Reuters) - The presidents of Russia and Turkmenistan met on Sunday but failed to announce a breakthrough in a pricing dispute that cut Turkmen gas flows to Russia, likely delaying a deal until a meeting in late December.

The meeting between Russian President Dmitry Medvedev and Turkmenistan's Kurbanguly Berdymukhamedov at the luxury Zavidoro hunting lodge near Moscow was the second in two months in a sign Ashgabat, short of budget revenues, is keen to resume supplies.

In April, Turkmenistan accused Russia of suspending gas imports because Russia's gas export monopoly Gazprom faced reduced demand in Europe and has said it would now seek alternative gas export routes. Gazprom initially blamed a pipeline blast for the halt but later said Ashgabat cannot continue selling the same volumes of gas when Europe slashes imports because of the crisis and because liquefied fuel is cheaper than pipeline gas.

Russian media reported last week Gazprom wants to cut purchases of Turkmen gas five-fold in 2010-2012.

Turkmenistan wants a quick resumption since gas, alongside oil and cotton, represents the lion's share of its budget revenues, bringing in up to $1 billion per month.

Russia used to be the main buyer of Turkmen gas, purchasing about 50 billion cubic metres a year, until April and the row has pushed Ashgabat towards the diversification of exports.

It has said it would increase gas sales to Iran, China and is ready to supply a third of gas needed for Nabucco, a US and EU-backed pipeline bypassing Russia and a key rival of Gazprom's new projects. (Reporting by Oleg Shchedrov, writing by Dmitry Zhdannikov; Editing by Mike Nesbit) ((+ 7 495 775 12 42)

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