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European Energy Commissioner will represent EU at gas talks in Kiev

June 14, 2014, 19:36 UTC+3 BRUSSELS
The Russian position in talks with Ukraine on gas was clear and consistent
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BRUSSELS, June 14, (ITAR-TASS). European Commissioner for Energy Guenther Oettinger will arrive in Kiev on Saturday for talks on gas issues, the spokeswoman has said.

Oettinger is expected to meet with Ukrainian parliament-appointed Prime Minister Arseny Yatsenyuk, the parliament-appointed Minister of Energy and Coal Industry Yuri Prodan, Naftogaz CEO Andrei Kobelev and Gazprom head Alexei Miller, spokeswoman Sabine Berger told ITAR-TASS on June 14.

Oettinger is planning to continue discussions on Russian gas supplies to Ukraine for finding mutually acceptable decisions, Berger said.

Earlier in the day, Gazprom’s spokesman Sergei Kupriyanov said a new meeting between Gazprom and Naftogaz of Ukraine would be held in Kiev on June 14.

“Now a new meeting is being prepared in Kiev to be held in another format, not the same as the previous consultations," he said.

The Russian position in talks with Ukraine on gas was clear and consistent, he said.

"We are ready to look for compromises, but it is not helpful to press on us. Our approaches to the solution of the accumulated problems have been repeatedly presented," Kupriyanov said.

"We will see what the new consultations will give," he added.

On June 12 the Gazprom CEO said if the Ukrainian side fails to settle the overdue $1.951 billion for supplied gas by 10am on Monday, June 16, Russia would introduce a prepayment mechanism.

On June 13 Miller said the company would not postpone any further introduction of the prepayment terms. “No prepayment, no gas,” he said.

In December 2013, Russian Gazprom and Naftogaz Ukrainy signed an addendum to the gas agreement in effect from January 19, 2009, under which the price of Russian natural gas for Ukraine was to be reduced by one-third to 268.5 U.S. dollars per 1,000 cubic metres from January 1, 2014, compared to 410 U.S. dollars per 1,000 cubic metres in the fourth quarter of 2013.

Moscow and Kiev also agreed that the discount would remain in effect as long as the key conditions were met, specifically timely payments for current supplies and repayment of debts.

At the end of the first quarter of 2014, Gazprom said it would have to raise the price of gas for Ukraine by more than 100 U.S. dollars to 385.5 U.S. dollars per 1,000 cubic metres because Ukraine had failed to pay the debt for the gas delivered in 2013 and had not made payments for current supplies.

The gas price of 385 U.S. dollars per 1,000 cubic metres offered by Russia to Ukraine is not the best one on the market, Prodan said after trilateral talks with Russian and EU officials in Brussels on June 11.

“We have many proposals, including on reverse flow supplies at a price much lower than 385 U.S. dollars. Given the transit across Ukraine and back to European countries, we can say that Gazprom’s price can be lower than what European suppliers are offering now,” he said.

Russia proposed renewing a 100-U.S. dollar discount for gas supplies to Ukraine, but Kiev turned down the offer.

Yatsenyuk said his government was insisting on changes to the effective gas contract. “If gas is a political weapon, then this is a political weapon in the hands of the Russian government. If gas is a commodity, as it is in the rest of the world, we trade on the basis of a contract, not on the basis of whether Russia likes the Ukrainian government or not,” he said.

The current price of Russian gas for Ukraine is 485 U.S. dollars per 1,000 cubic metres. Ukraine is insisting on the price of 268.5 U.S. dollars. However, this week Gazprom lowered the price of gas supplied to Ukraine in April and May to 384.86 U.S. dollars per 1,000 cubic metres.

Prodan said an acceptable gas price for Ukraine could be within the range of 268.5 to 385 U.S. dollars.

“If the matter is examined in the Stockholm court, Ukraine will be prepared to agree to the compromise price proposed by the European Commission. I do not want to name it, but it is within the range of 268.5 to 385 U.S. dollars per 1,000 cubic metres,” Prodan said.

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