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State Duma ratifies Russia-Kyrgyzstan gas deal

MOSCOW, January 17 (Itar-Tass) - The lower house of Russia's parliament, the State Duma, has ratified the Russian-Kyrgyz intergovernmental agreement on cooperation in natural gas transportation, distribution and sales that stipulates the acquisition of the Kyrgyz national gas operator Kyrgyzgaz by the Russian gas monopoly Gazprom.

According to the documents, the Kyrgyz side provides for a set-up of Kyrgyzgaz’s100-percent stake subsidiary that will own Kyrgyzgaz’s entire property, rights and interests, including high-pressure gas pipelines, gas distribution and compressor stations, underground storages, wells, lands, buildings, equipment, raw materials, products and debts estimated at no less than $40 million.

Gazprom gets a 100-percent stake in the fresh company’s capital worth $1. It is to invest no less than 20 billion roubles (about $606 million) in modernization and upgrade of the Kyrgyz gas infrastructure, as well as guarantee the development and modernization of equipment and main gas pipelines, compliance with tariff policies under the Kyrgyz law and uninterrupted natural gas supplies to Kyrgyz consumers. The new company and its legal successors are to supply gas and manage underground storages, gas distribution and sales, construction, upgrade and use of gas transportation and distribution systems, as well as other infrastructure facilities of the gas complex in Kyrgyzstan.

Kyrgyzstan, for its part guarantees the new company’s exclusive right to import natural gas for Kyrgyz consumers and non-interference in setting tariffs for gas transportation through Kyrgyzstan to third countries.

The 25-year agreement is subject to possible automatic prolongation for five-year terms.

“This is an important accord in terms of infrastructure, a step towards a unified gas distribution system of member countries of the future Eurasian Economic Union,” Slutsky said, adding Kyrgyzstan had already decided to join the Customs Union of Russia, Belarus and Kazakhstan and was “rapidly moving towards participation in the Eurasian project.

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