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Subject of three-party gas consultations exhausted, Gazprom CEO says

June 16, 2014, 19:16 UTC+3 MOSCOW

He noted that while leaving supplies of Russian gas unpaid, Ukraine had pumped astronomic amounts of gas to its own underground gas storage facilities

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MOSCOW, June 16. /ITAR-TASS/. The subject matter of three-party gas consultations, involving the European Union, Russia and Ukraine, has been exhausted, Russian Gazprom CEO Alexei Miller told a news conference on Monday.

“We were meeting (the Ukrainian side) halfway at the request of the European Commission, postponing the date for switching Naftogaz of Ukraine to a pre-payment system,” Miller said.

“In fact, Naftogaz reckoned it was possible to indefinitely take gas in the amounts it wanted,” the Gazprom CEO said. The whole logic of negotiations, which the Ukrainian side tried to impose, was to get a super-low price at the level Russia sells gas to the countries of the Customs Union (of Russia, Belarus and Kazakhstan), he said.

Miller did not rule out that following up the Monday lawsuit, Gazprom could file additional lawsuits against Naftogaz of Ukraine to the Stockholm arbitration court.

Miller noted that while leaving supplies of Russian gas unpaid, Ukraine had pumped astronomic amounts of gas to its own underground gas storage facilities. Out of more than 12.5 billion cubic meters of gas in Ukraine’s underground gas storage facilities (UGSF), 11.5 billion is unpaid Russian gas. Miller also said that in order to get through the winter season comfortably, Ukraine must have more than 18 billion cubic meters of gas in its UGSFs.

Commenting on the situation with Ukraine’s gas debt, Prime Minister Dmitry Medvedev said on Monday that Ukraine had artificially created a gas crisis. “Super-beneficial terms were offered to them even if we compare them with the period of gas cooperation during the previous presidency, but nevertheless they rejected these terms, and have in essence artificially created a gas crisis. This is regrettable and smacks of blackmail,” Medvedev said.

This absurd and unreasonable position assumed in gas negotiations will in the long run affect Ukraine’s economy and the people living in the country, Medvedev added.

Energy Minister Alexander Novak, for his part, said Gazprom could return to consultations on future supplies and on the pre-payment system as soon as Ukraine paid off its debt.

Meanwhile, Kiev is trying to attract European and American investors to the updating and joint servicing of its gas transmission system. Parliament-appointed Prime Minister Arseniy Yatsenyuk has ordered introduction of a respective bill to the parliament.

The capacity of Ukraine’s gas transmission system, managed by Ukrtransgaz, is 288 billion cubic meters at the entrance and 178.5 billion cubic meters at the exit, including 142.5 billion cubic meters of gas going to European countries and 3.5 billion cubic meters to Moldova.

The gas transmission system comprises 72 gas-compressor stations, 110 shops (groups of compressors) and 1,451 gas distributing stations. The company services 38,600 kilometers of gas pipelines, including 22,200 kilometers of gas mains and 16,400 kilometers of pipeline branches.

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