Russia, Azerbaijan to sign deal on boosting gas supplies

Russian gas giant Gazprom and Azerbaijan's state oil and gas company will sign a deal to increase supplies of Azerbaijani gas to Russia in 2011-2012 during the Russian president's visit to Baku on Thursday, RIA Novosti reported.


Gazprom CEO Alexei Miller said in mid-June that Gazprom is prepared to "buy as much gas as Azerbaijan is ready to deliver."

"As part of the [Russian president's] visit, an additional agreement to the contract on increasing natural gas supplies in 2011-2012 will be signed," Russian presidential aide Sergei Prikhodko said.

Deliveries of Azerbaijani gas began on January 1 after Azerbaijan's SOCAR signed a contract with Russia's Gazprom in October 2009 to deliver 500 million cubic meters of gas annually up to 2015, with the option of renewing the contract in the future.

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Later the companies agreed to double gas deliveries to Russia, bringing the total amount of gas delivery from Azerbaijan to 1 billion cubic meters. The companies will again double that amount to 2 million cubic meters in 2011.

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Azerbaijan's gas reaches Russia through its Baku-Novo-Filya gas pipeline along the Caspian Sea to the Russia's North Caucasus republics.

Russian and Azerbaijani presidents, Dmitry Medvedev and Ilham Aliyev, will also sign a border delimitation deal during the two-day visit.

The deal will delimitate the part of land border which begins on the junction of Russian, Azerbaijani and Georgian state borders and goes eastward until the Caspian Sea.

It is unclear whether the two presidents will discuss the status of the oil- and gas-rich inland Caspian Sea, which has been a source of long-running disagreements between the five littoral states - Azerbaijan, Iran, Kazakhstan, Russia, and Turkmenistan - since the collapse of the Soviet Union in 1991.

A Kremlin source told RIA Novosti that the heads of the two states would also discuss military cooperation but did not elaborate on the issue. However, it was recently announced that Azerbaijan would buy four Russian Ka-32 helicopters, used in utility cargo work and fire-fighting.

The long-running conflict between Azerbaijan and Armenia over Nagorno Karabakh will also be on the agenda, the Kremlin source said.