KIEV, Nov. 18 – Prime Minister Yulia Tymoshenko on Wednesday sparked confusion over upcoming talks with Russia after she suddenly reversed course and said the discussions will touch upon many economic issues, but not natural gas.

Tymoshenko is expected to meet her Russian counterpart Vladimir Putin in Yalta on Thursday as two governments are due to sit down for the talks over a range of economic and trade issues.

On Saturday, Tymoshenko said the issues will most definitely include discussions over “optimization” of natural gas prices next year.

But four days later, on Wednesday, Tymoshenko said the natural gas issues will not be on agenda at all.

“There will be no single issue [at the talks] between Russia and Ukraine that would concern natural gas,” Tymoshenko said at a press conference.

The turnaround was a surprise for many, including Naftogaz Ukrayiny, the national oil and gas company, which hopes the Tymoshenko-Putin talks would wave about $8 billion in penalties that otherwise Naftogaz may be subject to in 2009.

The legal settlement of the penalty would reduce significantly prospects of a new natural gas clash between Ukraine and Russia that may otherwise strike in January 2010.

“If we legally settle this by the [Russian-Ukrainian] commission that will get together on Thursday - as we suggest and if the Russian party agrees to – then we can be calm and stop waiting for any crisis phenomena. Everything will be legal,” Vadym Chuprun, deputy head of Naftogaz Ukrayiny, said in a statement.

Tymoshenko has repeatedly said that Putin – at a one-on-one meeting in September – had promised her that Russia would wave the penalties.

But Gazprom, the Russian gas giant, has never made a legal commitment to wave the penalties, and even Putin himself had said recently that Ukraine should stick to the gas agreement without elaborating.

The penalty comes from the gas agreement that has been negotiated by Tymoshenko and Putin in January to end a gas confrontation between Ukraine and Russia that had left more than 20 European countries without Russian gas supplies for almost two weeks in the middle of the winter.

The agreement penalizes Ukraine for any failure to import the originally promised amount of natural gas, while levies on penalty at all on Gazprom for moving less-than-expected natural gas to Europe via Ukrainian pipelines.

Ukraine originally pledged to import 42 billion cubic meters of gas in 2009 and 52 billion cubic meters annually during the next nine years, according to the agreement.

But Ukraine was likely to import about 25 billion cubic meters of gas in 2009 after many industrial gas consumers, such as steel mills, had reduced output dramatically in reaction to slower demand overseas.

“No one had thought in January that the crisis would affect the gas consumption and Damocles’ Sward - called the penalties - is now hanging over us,” Chuprun said. (sb/ez)