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. Last Updated: 07/27/2016

Russia Nears Compromise With Lufthansa Cargo

Russia expects to allow Germany's Lufthansa Cargo to continue using its airspace until the end of February, as both sides try to settle an ongoing dispute on overflight rights, a senior Transportation Ministry official said Tuesday.

The move will extend the current deadline, which runs until Thursday, and give both sides several months of breathing space in which to negotiate a permanent deal, said Vladimir Tasun, the head of the ministry's aviation policy department.

Russia wants Lufthansa to move its Central Asian freight hub from Astana in Kazakhstan to Krasnoyarsk. At the end of October, authorities barred Lufthansa Cargo from flying over the country, before provisionally reinstating overflight rights for two weeks.

That initial move caused controversy in Germany, but Russian officials have repeatedly blamed Lufthansa and German officials for failing to adhere to a range of bilateral agreements. German authorities reacted by briefly barring Aeroflot cargo planes from flying to the Frankfurt airport.

The two sides now seem to be edging toward a compromise. Lufthansa last week said it would consider a move to Krasnoyarsk and that it submitted a list of technical requirements to the Transportation Ministry.

Russian officials were still waiting to verify the finer points of the latest German proposal on Tuesday, but approval of the extension is expected Wednesday, Tasun said.

Tasun said Krasnoyarsk Airport could be ready to take Lufthansa Cargo flights by next autumn. The authorities are waiting on Lufthansa to make a concrete commitment to relocate to Krasnoyarsk before they begin spending the 250 million rubles ($10.2 million) of government funds required for modernization, he said.

Tasun added that Krasnoyarsk Airport's management might be willing to lower tariffs for Lufthansa to bring them in line with the lower fees the company pays in Astana.