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Ukraine has no choice but to buy coal in Russia or Donbass — Ukrainian minister

November 12, 2014, 15:00 UTC+3 KIEV

There is a threat to Ukraine's energy security

1 pages in this article
© ITAR-TASS/Yury Smityuk

KIEV, November 12. /TASS/. Ukraine has no other solution, but to buy coal in Russia or war-torn eastern coalmining region of Donbass, where militias are controlling the situation, Minister of Energy and Coalmining Yuriy Prodan said at a government meeting on Wednesday.

“There are two ways to settle the situation: to buy deficit coal in Russia or in east Ukraine. There is a threat that we will not be able to live through autumn and winter,” the minister said.

“The Republic of South Africa already denied further coal supplies to us. No less than six weeks are needed to sign a new contract. We have no other solution, but to buy coal from Russian suppliers. The coal supply situation is alarming. Energy security of the country is under threat,” Prodan said.

“We have around 1.7 million tons of coal in stock. These reserves are insufficient. We have stabilised the situation slightly from the start of this month. For this month we succeeded to stock 80 thousand tons of coal. We expect the situation to deteriorate,” the minister added.

In this connection, Prime Minister Arseniy Yatsenyuk instructed country’s security services to settle the situation and punish those guilty. “I instruct Ukrainian Security Service to probe division of the coal market,” he said, adding that he ordered the Foreign Ministry “to offer variants on countries which can deliver coal.”

Last Tuesday, director of state-run company Ukrinterenergo Vladimir Zinevich said that British global trading and logistics company Steel Mont Trading Ltd refused to deliver coal to Ukraine from South Africa. “Now they are not ready to deliver coal to us for $86, because demand for anthracite grows in winter,” he noted.

Zinevich noted that this decision was also caused by failure to pay for South African coal on fourth vessel in second coal delivery that was expected to arrive on November 25.

Now Ukraine buys coal in the Republic of South Africa at the price of $86 per ton. Steel Mont Trading funds 80% of purchased supply. Three vessels have already come with coal supplies and the same number of ships with supplies is expected soon, but the coal price may change.

The transparency of the coal purchase deal with South Africa was raised at a meeting of Ukrainian Council of National Security and Defense on November 4. Therefore, Ukrainian Prosecutor General’s Office opened a budget embezzlement case. Ukrinterenergo chief Vladimir Zinevich and Minister of Fuel and Energy Yuriy Prodan were summoned for questioning last Monday.

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