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Czech Government To Retain Full Stake In TransGas

Prague, May 16 (RFE/RL) -- Czech Industry Minister Vladimir Dlouhy today said that the Prague government wants to retain 100 percent ownership stake in TransGas, the firm that controls the country's high-pressure natural gas pipelines from Russia.

Dlouhy told RFE/RL that there is "a certain danger in the unnecessary loss of strategic control" of the pipeline network. He would not elaborate.

But Dlouhy said today at a privatization conference in Prague, which drew delegates from across east and central Europe, that the Czech government's decision about TransGas had been influenced by its analysis of Hungarian pipeline politics.

Opposition parliamentarians in Budapest have complained about the alleged involvement of government officials in deals for Russian gas shipments to Hungary. They say such deals have compromised Hungary's energy independence.

Budapest is said to have made pledges that would allow Russia's Panrusgaz to build a new pipeline from Slovakia across Hungary and on into Slovenia and Italy. Opponents of that plan say the pipeline would further erode Hungary's energy independence by taking over a significant portion of gas shipments now handled by the Hungarian energy giant, MOL.

Dlouhy said Prague "may be ready" start discussing privatization of its own energy giant, CEZ, in 1999 or 2000. Plans have already been created to sell off the country's regional energy distribution companies. Dlouhy said 20 percent stakes have been reserved for a foreign strategic partner.

But he said it is "useless to proceed" with those privatizations until a regulatory framework for the sector is approved by parliament. That framework would include policies on pricing, subsidies and third party access to the Czech energy grid.

Dlouhy said discussions about selecting potential foreign partners for the regional energy distributors would have to wait until after parliamentary elections on May 31 and June 1.

Analysts say Prime Minister Vaclav Klaus stands an excellent chance in that ballot to reform his coalition with the centrist Christian Democrats and the centre-right Civic Democratic Alliance.