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Russia-Ukraine gas dispute

Estimated gas price for Ukraine comfortable without discounts — minister

Russia’s energy minister says no changes can be made in the gas supply contract with Ukraine until 2019 year-end

© AP Photo/Sergei Chuzavkov, File

MINSK, June 8. /TASS/. The estimated natural gas price for Ukraine in the second quarter of 2016 is $177 [per 1,000 cubic meters - TASS] and it is comfortable without discounts, Russia’s Energy Minister Alexander Novak said on Wednesday.

RUSSIA-UKRAINE GAS DISPUTE

No changes can be made in the gas supply contract with Ukraine until 2019 year-end, the minister said. The most important is Ukraine’s Naftogaz is able to pay, he added.

"We always maintain the position that no amendments can be made in the contract until 2019 year-end. In particular, referring to gas supplies to Ukraine, current prices of Ukraine effective even in the second quarter are much more comfortable than spot and European gas hubs prices," Novak said. The estimated price for the second quarter is $177, he added.

"The price is not yet available for the third quarter; it will be calculated. The price in the second quarter established to date is absolutely comfortable without discounts and fully corresponds to the market situation. The main issue is whether Naftogaz has funds. If funds are available, it means they are ready to buy," Novak said.

"From our point of view, the effective contract valid until 2019 totally determines all conditions of interaction between two companies and the price under the contract formula appears to be the absolutely market one," the minister said.

Naftogaz needs a speed up

Read also

Ukraine’s Naftogaz confirms letter to Gazprom on gas supplies

Naftogaz of Ukraine is behind the winter preparation schedule and needs to increase the daily rate of natural gas injection into underground storages by 2.5 times, Chief Executive Officer of the Russian gas holding Gazprom Alexei Miller said.

"Naftogaz of Ukraine lags behind last-year schedules of preparation for winter. According to data from public sources, Ukraine’s UGS [underground gas storages] received just 0.854 bln cubic meters from April 7, when Naftogaz of Ukraine initiated gas injection to underground storages, until June 6. Daily injection rate was just 20.32 mln cubic meters on June 6. It is well known that reliability of gas deliveries to European consumers in winter season depends on the loading of Ukrainian underground storages. Naftogaz of Ukraine needs to increase the daily injection rate by more than 2.5 times in order to create at least last-year reserves volume in UGS," Miller said.

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Foreign policy Russia-Ukraine Gas Dispute

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