18:13 GMT +318 December 2018
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    Russian company to halve its gas supplies to Tbilisi

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    TBILISI, July 19 (RIA Novosti, Marina Kvaratskhelia) - The Russian gas company Gazexport will halve its natural gas deliveries to the Georgian capital from July 20, a company spokesman said.

    Gazexport, which is wholly owned by the gas giant Gazprom, made this decision after Georgia's Tbilgaz accrued $2.68 million in debt in a two month period and failed to repay its restructured debt for gas deliveries in 2003-2004 (it owes $5.7 million for this period).

    Gazexport said that it had constantly warned Tbilgaz, the Tbilisi mayor's office, which holds a controlling stake in Tbilgaz, and the Georgian Energy Ministry about the possibility of cuts in gas supplies.

    Gazexport's official spokesman, David Morchiladze, said that Tbilgaz owed about $10 million, including penalties and fines, which suggested the company was insolvent. Therefore, Gazexport would halve its gas deliveries to the Georgian capital.

    Gazexport supplies 400,000 cubic meters of gas to Tbilisi daily.

    Morchiladze said that the severance of the contract was a more serious problem for the Georgian customer than the termination of gas deliveries.

    "If the debt issue is not resolved within 60 days, then in accordance with its contract with Tbilgaz, Gazexport will terminate gas deliveries and will renegotiate the terms for gas supplies," Morchiladze said.

    The Georgian Energy Ministry said that Morchiladze probably meant that gas prices could go up.

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