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Russia to restart gas supplies, if Ukraine repays $2 billion debt — minister

August 29, 2014, 13:59 UTC+3 MOSCOW

The Russian energy minister also said Russia was prepared to offer Ukraine a gas price discount of $100 per 1,000 cubic meters

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© ITAR-TASS/Anton Novoderezhkin

MOSCOW, August 29./ITAR-TASS/. Russia is ready to resume natural gas supplies to Ukraine, if Kiev repays its $2 billion debt, Russian Energy Minister Alexander Novak said on Friday.

Novak made this statement after talks with EU Energy Commissioner Guenther Oettinger who had arrived in Moscow on Friday to try to find a solution to the Russia-Ukraine gas price dispute. The European Commission has recommended Ukraine to start delivering payments for the supplies of Russian natural gas, Marlene Holzner, a spokeswoman for EU Energy Commissioner Gunther Oettinger, said on Friday.

The Russian energy minister said this figure included Ukraine’s $1.4 billion debt for Russian natural gas deliveries to the ex-Soviet republic in 2013 and partial repayment of the gas debt accumulated from April.

The Russian energy minister also said Russia was prepared to offer Ukraine a gas price discount of $100 per 1,000 cubic meters, which would not breach the country’s contractual obligations and would not contradict Russia’s position in an international arbitration tribunal as this offer was not a corporate discount.

“We are prepared to offer this discount not only for the winter period but even for a year or for a year and a half,” Novak said.

Russia raised the gas price for Ukraine from $268.5 to $485.5 per 1,000 cubic meters from April 2014. Ukraine has said it will not pay for Russian natural gas supplies at such a high price.

After Russia and Ukraine failed to reach a compromise on the gas issue, Naftogaz and Gazprom filed mutual claims to the Stockholm Arbitration Tribunal.

The gas price for Ukraine has increased, in particular, by $100 per 1,000 cubic meters since April 1, 2014 after Russia denounced the 2010 Kharkov accords on extending the lease of the Russian Black Sea Fleet’s base in Crimea in exchange for a gas price discount. The accords were denounced after the Black Sea peninsula joined Russia in the spring of 2014.

Russia also offered Kiev the second discount as part of an anti-crisis aid package for Ukraine in November 2013 but scrapped it from April 1, 2014 over Ukraine’s failure to repay its debts for Russian natural gas supplies.

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.

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