After months of seemingly deadlocked talks between Gazprom and Turkmenistan over gas prices, the Russian gas titan has now agreed to buy gas from Turkmenistan at an increased price of $100 per 1,000 cubic meters.

The agreement was struck between Alexey Miller, chairman of Gazprom’s management committee and Turkmenistan Republic president Saparmurat Niyazov in a recent meeting.

In the course of the negotiations, the parties discussed cooperation issues in oil and gas sectors, agreed on delivery terms for additional Turkmen gas volumes in 2006 and specified the price and supply quantities for 2007 to 2009.

The higher price of $100 for 1,000 of cubic meters is fixed for the period, Gazprom revealed, representing a 54% increase over the previous price of $65 per 1,000 cubic meters. An additional 12bcm of gas will be supplied in 2006, in 2007 to 2009, total gas supplies will amount to 50bcm per year.

The agreement means that Gazprom will now be able to meet its export responsibilities. However as it is likely that the increased costs will be passed onto Ukraine, supply disruption could still become an issue if Ukrainians respond to the hikes in the same manner as seen at the start of the year.