* Greece, Gazprom to announce new supply deal- sources
* New supply deal will extend to 2026
* DEPA gets price cut of at least 15 percent
(Adds second source, background)
By Harry Papachristou
ATHENS, Feb 20 Greece and Russian energy giant
Gazprom will soon announce a new gas supply deal
including price cuts backdated to last June, sources said on
Gazprom is the biggest supplier of Greece's state-run
natural gas distributor DEPA. The two sides have been in talks
for months, with DEPA seeking a cut of between 15 and 20 percent
in the gas supply price and threatening to go to arbitration if
there is no agreement.
"We consider that this will be a done deal in the next few
days. The lower prices will apply retroactively from June 2013,"
a Greek ministry official said on condition of anonymity.
Gazprom declined to comment.
Greece is keen to reduce its industry's energy costs to help
to shield it from the effects of the country's deep six-year
recession that has led to a wave of corporate bankruptcies and
unemployment of 28 percent
According to another source close to the talks, an outline
agreement struck at company level between DEPA and Gazprom last
month also got a green light at government level after a meeting
between Russian President Vladimir Putin and Greek Prime
Minister Antonis Samaras.
The Greeks are now just pressing for marginal improvements,
on price or quantities, and are no longer considering going to
"The initial agreement also extends to government level now,
so there's no question of arbitration any more," the source
According to the second source, the price initially agreed
will be below $400 per 1,000 cubic metres of gas, down from the
$470 DEPA pays now. The energy ministry source declined to
elaborate on the level of the price, saying that it will
continue to be linked to oil prices.
The current deal, which expires in 2016, will be extended to
2026, with Gazprom to supply DEPA between 2.5-3 billion cubic
metres a year.
Combined with a recent, five-year supply agreement over 1
bcm between DEPA and Azeri consortium Shah Deniz, the Gazprom
deal secures DEPA's supply for years to come and may increase
its value ahead of its planned privatisation, the source said.
"This agreement gives DEPA flexibility to cope with Greece's
economic crisis and increases its market value," the source
said. DEPA, whose planned privatisation failed in 2013, will be
re-launched this or next year.
(Additional reporting by Ekaterina Golubkova in Moscow. Editing
by Jane Merriman)