Text of report in English by Russian state news agency ITAR-TASS

Moscow, 3 March: Russia's energy export and import monopoly Inter RAO UES says it is ready to switch to long-term contracts on power supplies with Mongolia.

On Tuesday, Moscow hosted the talks that brought together representatives of Inter RAO UES, Mongolia's state-run power companies and Ministry of Mineral Resource and Energy.

"At present, Inter RAO and Mongolia's state-run power companies have contracts until 2012 that envision annual adjustment of price parameters and supply terms," a source at Inter RAO UES told ITAR- TASS. "Inter RAO offered state-run power companies of Mongolia responsible for exports and imports to switch to long-term fifteen- year contracts on power supplies."

"The Mongolian side plans to study these proposals and make a response until the middle of March. If a positive decision is taken, the parties will also hold consultations engaging responsible ministries and infrastructure companies," the source said.

The proposals of Inter RAO are developed with participation of the Russian Energy Ministry and are aimed at long-term and mutually advantageous cooperation in energy.

If Mongolia agrees to switch to long-term contracts, the price formula on the supply of power will be adjusted once in three years. Thus, Mongolia will have an opportunity to plan its budget and draft a long-term strategy for social and economic development. Moreover, Mongolia will be able to use long-term contracts as a pledge of funding for its projects, including those on the construction of power generating facilities.

Inter RAO, in turn, will get an opportunity for the long-term planning of the revenue side of its budget on one of its major export activities.

Originally published by ITAR-TASS news agency, Moscow, in English 0243 3 Mar 10.

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Mongolia gets offers of long-term power supply contracts from Russia

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