RUSSIA THREATENS TO CUT GAS SUPPLY TO BOSNIA

SARAJEVO, Bosnia (October 24,2008) - Russian Gazprom has announced that it would halt its supply of natural gas to Bosnia from January 1, 2009, if a debt totalling 104.8 million US Dollars is not settled by that time.

Bosnia has already faced such threats on several previous occasions.

Bosnian main energy company Energoinvest’s head Dzemail Vlahovljak, who is currently in Moscow at the helm of a Bosnian delegation, said Russians have made their threat more clear than ever before, and announced they would not back down again.

Furthermore, they have threatened for the first time to turn the issue of Bosnia’s debt over to arbitration and court, Vlahovljak said, adding that that would be the worst option for Bosnia, since she would have to pay almost 300 million US Dollars including interest, instead of 104.8 million.

The Russian side has proposed the introduction of a special tax which would be charged to all gas consumers for the purpose of paying the debt. The Bosnian government has little over two months to solve the problem.
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