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Gazprom’s position at Russia-Ukraine gas talks unchanged — CEO

August 29, 2014, 12:57 UTC+3 MOSCOW

Gazprom says Naftogaz’s debt under the “take or pay” clause has already exceeded $11 billion

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© ITAR-TASS/Sergei Fadeichev

MOSCOW, August 29./ITAR-TASS/. Gazprom’s position at Russia-Ukraine gas talks remains unchanged, Gazprom CEO Alexei Miller said on Friday.

Miller made his statement as EU Energy Commissioner Guenther Oettinger had arrived in Moscow on Friday to try to find a solution to the Russia-Ukraine gas price dispute.

The Russia gas giant’s head said that Gazprom’s position was now of less compromise nature as the dispute with the Ukrainian national energy company Naftogaz was under review at the Stockholm arbitration tribunal.

“Now arbitration proceedings have started in Stockholm,” Miller said, adding that this was the reason why Gazprom could not change its position, including its stance on Ukraine’s obligations under the “take or pay” clause of the 2009 gas contract signed between Russia and Ukraine.

Gazprom says Naftogaz’s debt under the “take or pay” clause has already exceeded $11 billion.

Gazprom halted gas supplies to Ukraine in June over its unpaid debt and filed a $4.5 billion suit to the Stockholm arbitration court. Later, Kiev reciprocated by sending a suit to the court against Gazprom for making Ukraine overpay $6 billion for gas since 2010, setting too high prices in its contract.

Miller also said that Gazprom had not received any signal from Naftogaz about the Ukrainian company’s readiness to repay debts for natural gas supplied to Ukraine in previous months. Gazprom says this debt has already topped $5 billion.

The European energy commissioner is expected to hold gas talks in Moscow with Russian Energy Minister Alexander Novak and Gazprom head Miller.

The commissioner’s spokesperson, Marlene Holzner, earlier said that Oettinger would present the European Commission’s new proposals on a gas compromise between Russia and Ukraine as part of preparations for resuming ministerial gas talks between Moscow, Kiev and EU officials.

The EU has suggested an interim agreement on Russia’s gas supplies to Ukraine without waiting for a Stockholm arbitration court ruling, Oettinger said on Wednesday.

Infographics Russian gas in Europe

Russian gas in Europe

One-third of gas consumed in EU comes from Russia. Infographics ITAR-TASS
Two cases are before the Stockholm court, but the hearings will take 12-15 months, which is too long, while Europe needs an interim solution for this winter, Oettinger said.

Some observers say the EU hopes to persuade Russia to introduce an interim regime of gas supplies at seasonal prices to allow Ukraine to pump the missing 5 billion cubic meters into its underground storage facilities.

However, this mechanism weakens Gazprom’s positions in Stockholm arbitration proceedings.

Brussels and Kiev have elaborated a joint position that gas prices for Ukraine should be at the level of $320 per 1,000 cubic meters during the summer season until mid-October and $385 per 1,000 cu m during the heating season. Ukraine however, earlier rejected a seasonal scheme proposed by Gazprom.

At a meeting held in Minsk on Tuesday between the leaders of Russia, Belarus and Kazakhstan, which form the Customs Union, EU officials and the Ukrainian president, Russian Energy Minister Novak said that Russia’s position was unchanged and Ukraine must repay its $5 billion debt to continue cooperation with Moscow.

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