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Ukraine, Russia fail to strike gas deal
Journal Staff Report

KIEV, Sept. 13 - Ukraine and Russia on Wednesday failed to reach an agreement on prices for natural gas that is to be supplied in October through the end of the year, Ukraine’s energy and fuel ministry reported.

Energy and Fuel Minister Yuriy Boyko was in Moscow for a meeting with Alexei Miller, the CEO of Gazprom, Russia’s state-controlled gas monopoly, to secure extra supplies of gas at affordable prices in the fourth quarter.

The failure leaves in limbo Prime Minister Viktor Yanukovych’s plans to keep natural gas prices unchanged in the fourth quarter. The parties will probably try to hold another round of talks later this month, analysts said.

Ukraine faces a shortage of up to 8 billion cu m of gas this year, or more than 10% of the country’s annual demand, which would affect the economy in the fourth quarter.

This is the second meeting between Boyko and Miller over the past seven days, underscoring Ukraine’s desperate attempts to secure sufficient supplies of gas at affordable prices.

Last week, Gazprom indicated it will supply the extra gas, but the parties had failed to agree on prices.

Ukraine has been seeking to buy the extra gas from Russia at the current price of $95 per 1,000 cubic meters. Gazprom, which does not have its own extra gas, recently agreed to purchase up to 12 billion cu m of gas from Turkmenistan and this gas can be supplied to Ukraine starting in October.

However, the price, which Gazprom agreed to pay for the Turkmen gas, suggests that Ukraine would have to pay at least $135 per 1,000 cu m, a level that Ukrainian officials have repeatedly said was too much.

Gazprom again suggested on Wednesday it could lower the prices for Ukraine in return for “strategic partnership” in the energy sector, a wording that analysts say suggests that Russia has been seeking concessions from Ukraine.

Gazprom has been long seeking to get control over Ukraine’s gas transportation network that moves Russian gas for exports to Europe and that has been by analysts as one of the concessions for the lower prices.

Turkmen gas debts paid

Meanwhile, Ukraine paid off Wednesday its debt to Turkmenistan for natural gas as had been earlier planned, but this will not help to resume gas supplies from the Central Asian country, officials said. that had recently sold most of its available gas to Gazprom of Russia.

"Ukraine has resolved the issue. Now it has no debt for Turkmen natural gas deliveries," said Yuriy Krolchuk, spokesman for the state-run gas company Naftogaz, told the Associated Press.

He said that Ukraine had paid $10.5 million, the amount he said it owed as of the end of August.

After acrimonious talks over what Turkmenistan had said was $170 million in debt for 2003-2005, the countries agreed in March that Ukraine would pay off roughly $88 million in cash, with another $58.3 million to be paid off with supplies of pipes by August, according to Turkmenistan.

Ukraine concluded a deal last December to receive about 40 billion cubic meters of Turkmen natural gas this year, with the price set at $50 per 1,000 cubic meters in the first half of 2006 and $60 in the second half, but Turkmenistan has delivered no gas, Krolchuk said.

"Turkmenistan sold all its gas to Gazprom. Now we hope for on constructive and successful talks with Gazprom," he said. (nr/ez)

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Currencies (in hryvnias)
  16.07.2018 prev
USD 26.23 26.23
RUR 0.421 0.422
EUR 30.54 30.58

Stock Market
  13.07.2018 prev
PFTS 495.1 491.8
source: PFTS


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