All news

Kiev sent draft gas transit contracts to Gazprom — Ukraine’s Energy Ministry

Signing a gas transit contract with Gazprom is a priority for Ukraine, according to the minister

KIEV, November 25. /TASS/. The Ukrainian side has sent draft gas transit contracts to Gazprom, Ukraine’s Energy and Environment Minister Alexey Orzhel said on Monday.

"Draft contracts have already been sent to Gazprom, as the European legislation stipulates," Orzhel stated. "I believe Russia is also interested in signing the transit contract," he noted.

Meanwhile, Alexey Orzhel called the signing of a gas transit contract with Gazprom before the end of 2019 "the absolute priority for Ukraine." "For us, the absolute priority is the signing of an agreement on transport of [gas]," he told a press conference in the city of Vyshgorod, the Kiev region, on Monday.

The Minister stressed that after Ukraine adjusts its energy legislation to the EU rules it will be possible to talk about the de-politicization of this issue.

"We will no longer be under political pressure, once we have European rules," he claimed.

"If we sign a transit agreement with Gazprom, then, taking into account the reserves that we and Europe have in gas storages, we can witness one of the lowest gas prices this winter," he added.

According to Orzhel, Kiev, in dialogue with European partners, is doing "absolutely everything to ensure the signing of a transit contract."

"This is revenue of up to $3 billion to the budget," he added.

Russia, the European Commission and Ukraine have been in consultations on gas transit after 2020. However, the dialogue is complicated by the ongoing legal disputes between Russia’s Gazprom and Naftogaz of Ukraine. Moscow offers a "package solution" that includes a settlement agreement on litigation and direct gas purchases at reduced prices. As a fallback, Russia is ready to extend the current transit agreement for the whole 2020.

The next round of trilateral consultations on the transit of Russian gas to Europe through Ukraine from 2020 is scheduled for November 29.

The existing contracts for the supply and transit of Russian gas through Ukraine expire on December 31. By this time, Russia plans to launch two gas pipelines bypassing Ukraine — the Nord Stream 2 and the TurkStream.

Gazprom's terms

Abandonment of litigation with the Russian gas holding Gazprom and signing of a short-term gas transit contract are not acceptable for Ukraine, Ukrainian Energy Minister Alexey Orzhel said on Monday.

"Terms we received last Monday from Gazprom on abandonment of all arbitration proceedings and signing of a contract for one year are not acceptable," the minister said.

The short-term gas transit contract does not benefit Ukraine, the minister said. "A long-term contract provides an opportunity of raising long-term cheap money for investments, appropriate needs and gas transport," he added.