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19 Jan, 2022 20:07

Moldova declares state of emergency

The decision comes after Gazprom warned it could cut off shipments
Moldova declares state of emergency

The government of Moldova has declared a new 60-day state of emergency, following a warning from Russian energy firm Gazprom that it could halt gas deliveries to the country due to unpaid bills.

Prime Minister Natalia Gavrilița announced the news at a cabinet session on Wednesday, saying, “the decision has been approved. It must now be confirmed by parliament. After that, an emergency commission will take full measures to ensure that consumers have uninterrupted access to gas.”

Gavrilița reported that Gazprom had sent the government of Moldova an official notice that if it failed to pay its outstanding debts to the company in January, the Russian state energy giant would shut off gas shipments. Deputy Prime Minister Andrei Spinu also said that Moldova would request to pay off its debts in stages.

“[State energy company] Moldovagaz will pay Gazprom an advance of $38 million by January 20,” Spinu announced. “That leaves another $25 million in January, and Moldovagaz requested that this payment be delayed, but it could not come to terms with Gazprom, which didn’t want to help its daughter company.” He added that Moldovagaz is counting on receiving credit in order to pay down this debt.

Vadim Cheban, the head of Moldovagaz, had previously announced that the company would not be able to pay back Gazprom in January, saying that tariffs had not kept up with the rising cost of gas, and that the company was in such financial straits that it could not get credit from banks.

Moldova had previously declared a state of emergency in October to combat its energy crisis, after which Moldovagaz and Gazprom signed a five-year contract, agreeing to monthly payments. Moldova was forced to request an extension on its November payment, when Gazprom also threatened to shut off shipments, but Moldovagaz was eventually able to pay the $75 million bill. In his address on Wednesday, Spinu insisted that this situation will not happen again once the current crisis has been resolved.