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    Turkmenistan to raise gas price to $130 from Jan. - Gazprom

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    ASHGABAT, November 27 (RIA Novosti) - Russian energy giant Gazprom announced on Tuesday it has agreed to pay Turkmenistan $130 per 1,000 cubic meters of natural gas in the first half of 2008.

    It said the price, included in a supplement to the contract on natural gas deliveries from the Central Asian republic, will rise further from the second half of 2008, to $150 per 1,000 cu m, and as of January 1, 2009 will be set by a "market price formula."

    The document was signed in Turkmenistan during the visit of a Gazprom delegation led by CEO Alexei Miller, who met with President Gurbanbuly Berdymukhammedov.

    Miller said the formula used from 2009 would serve as a basis for setting long-term contract prices through 2028.

    Turkmenistan supplies about 50 billion cu m of gas annually to Russia at $100 per 1,000 cu m under a 2006-2009 deal signed by Gazprom and the Central Asian state's late leader Saparmurat Niyazov.

    Ashgabat's price hike is set to hit Ukraine, which buys Turkmen gas from Russia. Talks on a price formula for gas supplies to Ukraine in 2008 are underway between Moscow and Kiev.

    From early 2006 Ukraine paid an average of $95 per 1,000 cu m for a mixture of Turkmen and Russian gas supplied at the border. After the Central Asian state hiked its gas price, the rate for Ukraine was raised to $130 per 1,000 cu m from January 1, 2007.

    Ashgabat argues that Russia has also been raising energy prices for ex-Soviet republics and has pointed to rising gas prices on global markets. The average gas price for the European Union is expected to hit $360 by the end of 2008.

    The price issue has proved a stumbling block at talks on a new pipeline to pump 10-20 billion cu m of Turkmen gas along the Caspian Sea coast to Europe via Russia's pipeline network. Russia, Turkmenistan, and Uzbekistan agreed on the project in May, but have failed to finalize it.

    Turkmenistan, the second largest gas producer after Russia among ex-Soviet states, exports gas via a Russian-controlled network of pipelines, but has been considering diversifying export routes.

    Turkmen gas has been supplied via the 1974 Central Asia-Center pipeline, which runs through Uzbekistan, Kazakhstan and Russia. During talks between ex-Soviet states' prime ministers on Thursday, the three countries pledged to speed up the network's modernization and raise capacity by 20 billion cu m from the current 40 billion.

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