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Kremlin denies $5 billion gas pipeline pre-payment to Greece. IMF debt payments loom large in May

If Greece does secure a $5 billion pre-payment from Moscow, connected to the Turk Stream pipeline deal, that would mean, in my opinion, that the Athens government is moving forward with a Eurozone divorce.

The reasoning being, that Moscow would ultimately place covenants on the gas prep-payment, stating that none of the funds received by Athens would be used to pay back pending IMF payments.

Having $5 billion in Russia money enter Athens’ coffers, only to immediately leave out the back door to pay the US controlled IMF would be, to say the least, an embarrassment for the Kremlin.

If, as the Kremlin stares, no $5 billion pre-payment has been issued, or even asked for by Athens, then effectively it supports the fact that Tsipras is indeed looking for a “European” solution to Greece’s debt woes.

Via Reuters:

German magazine Der Spiegel, citing a senior figure in Greece’s ruling Syriza party, said the advance funds could “turn the page” for Athens, which is now struggling to reach a deal with its creditors to unlock new loans to avert bankruptcy.

“No, there wasn’t (any agreement),” said Kremlin spokesman Dmitry Peskov, in comments made to Business FM radio and quoted by RIA news agency.

Peskov reiterated that the Greeks had not requested financial assistance during talks in the Kremlin earlier this month between Prime Minister Alexis Tsipras and Russian President Vladimir Putin.

“Naturally the question of energy cooperation was raised. Naturally … it was agreed that at the expert level there would be a working-out of all issues connected with cooperation in the energy sphere, but Russia did not promise financial help because no one asked for it,” Peskov was quoted as saying.

During his visit to Moscow, Tsipras had expressed interest in participating in a pipeline that would bring Russian gas to Europe via Turkey and Greece.

Under the proposed deal, Greece would receive advance funds from Russia based on expected future profits linked to the pipeline. The Greek energy minister said last week that Athens would repay Moscow after 2019, when the pipeline is expected to start operating.

Greek government officials were not immediately available to comment on the Spiegel report.

Speaking in Washington on Saturday, German Finance Minister Wolfgang Schaeuble said he would be happy if the Spiegel report proved correct and Greece received the advance funds, but added:

“I do not think that this would solve the problems Greece has in fulfilling the commitments of the memorandum of understanding (with its European partners).”

References:

http://www.reuters.com/article/2015/04/18/us-eurozone-greece-russia-gas-idUSKBN0N90CR20150418

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