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Slovakia: New Gas Director Linked To Russian Deal

Bratislava, 2 April 1997 (RFE/RL) -- The Slovak Economic Ministry's appointment yesterday of Jan Ducky to the post of general director of the Slovak Gas Industry state enterprise, SPP, had been rumored for at least two months. The move could herald a further step toward cementing Slovak-Russian ties.

Ducky, a parliamentary deputy of Prime Minister Vladimir Meciar's Movement for a Democratic Slovakia, is a former economics minister. He is reported to have no experience in the gas industry, unlike his predecessor, Arpad Demko.

No official reason has been given for Demko's dismissal. But RFE/RL correspondents in Bratislava report that one key reason appears to be Demko's lack of support for a proposed joint venture in gas transport and distribution with Russia's Gazprom.

Russian Prime Minister Viktor Chernomyrdin -- who is a former chairman of Gazprom -- may sign a gas accord between Gazprom and SPP during a visit to Bratislava in mid-April. SPP spokesman Lubo Rabay told our correspondent last week that talks with the Russian enterprise have been under way "for some time" and that SPP is technically prepared to form a joint enterprise for transporting and distributing gas. But he said contract conditions are still under discussion. In Rabay's words, "we are ready to enter into this provided conditions are mutually beneficial."

Rabay says Slovak authorities are making a joint venture conditional on the Russians agreeing to build a new pipeline to transport additional quantities of gas across Slovakia. But Gazprom's chairman, Rem Vyakhirev said several months ago that no new pipleline is going to transit Slovakia.

The Bratislava daily "Sme" quotes opposition economist and lawmaker Mikulas Dzurinda of the Christian Democratic Movement as saying a joint venture with Gazprom would mean a financial loss for Slovakia and in his words would be "a signal that we have succumbed to huge political and possibly financial pressure."

In an interview with "Sme" published today, Dzurinda says a joint venture with Gazprom would have to split the profits Slovakia currently earns from permitting Russian gas to transit its territory. He said a joint venture would only make sense for Slovakia if a new transit pipeline were to be built and the venture would control only the gas supplies through the new pipeline.

The left-wing Slovak daily "Pravda" notes Gazprom has been pushing for a joint venture with Slovakia since 1995. Pravda says Meciar has until now refused to make such a deal, allegedly on the grounds of reduced profits for SPP and the threat to SPP's ability to set the price of gas in Slovakia. Pravda says Vyakhirev met with Slovak Economics Minister Karol Cesnek late last year but that no official statement was ever made about the meeting.

Dzurinda asserts that Ducky as Economics Minister already signed one accord with Russia that -- he alleges -- was to Slovakia's detriment. That deal, reached in 1995, concerned the completion of the first two reactors of the Mochovce nuclear power plant. Under that contract, he says, the Slovak government "guarantees to purchase nuclear fuel from the Russian federation for the needs of all Slovak nuclear power plants during the entire period they are in operation" in exchange for spent nuclear fuel from Slovakia for reprocessing by Russia and resale to Slovakia. In Dzurinda's words, "the entire deal harms Slovakia."

Our correspondents in Bratislava suggest Gazprom is seeking to avoid a repetition of the recent Czech move to end dependence on Russian gas supplies by signing a deal with Norway for North Sea gas. A joint venture between Gazprom and SPP would preserve Russia's monopoly stake in Slovakia's gas matters.

"Sme" says SPP is one of Slovakia's most profitable enterprises with pretax profits for 1995, the most recent year for which figures are available, of $406 million.

Ducky refused to speak with our correspondents. But in an interview with Bratislava's Radio Twist he denied Demko's recall was linked to a worsening of relations with the Russians. On the contrary, Ducky insists, relations between SPP and Gazprom have recently improved and may improve still further during Chernomyrdin's visit.

Reported by Jolyon Naegele in Prague and Marian Bednar and Ivan Stulajter in Bratislava