EU hopes Russia and Ukraine reach compromise in gas supplies without legal action

Business & Economy June 08, 2014, 15:32

“The European Commission is aimed at achieving a compromising agreement, which at any times is preferable than any legal action," a source at the European institutions said

BRUSSELS, June 08 /ITAR-TASS/. The European Union hopes Russia and Ukraine at the tripartite meeting will be able to achieve a compromise in gas, without using any legal action, a source at the European institutions in Brussels told Itar-Tass on Sunday.

“Right now we are finalising organisation of another tripartite meeting in Brussels on Monday (June 9) afternoon, where will participate Commissioner (Gunther) Oettinger, minister (of energy of Russia Alexander) Novak and his Ukrainian counterpart Yuri Prodan,” the source said, adding the meeting would feature also representatives of Gazprom and Naftogaz.

“The European Commission is aimed at achieving a compromising agreement, which at any times is preferable than any legal action. A court may last for quite a time, and we cannot afford risking the energy supplies to Europe for the term of legal actions,” the source said.

Earlier on Sunday, an official representative of Russia’s ministry of energy said a tripartite meeting featuring representatives of the European Union, Ukraine and Russia was due in Brussels on Monday.

The source said the meeting’s agenda would include gas prices for Ukraine, and by June 10 the Ukrainian side was expected to settle all the issues of the overdue payments.

The previous round of tripartite talks was held in Brussels on June 2. They were attended by Russian Energy Minister Alexander Novak, European Commissioner for Energy Guenther Oettinger, as well as Ukrainian parliament-appointed Minister of Energy and Coal Industry Yuri Prodan. The talks focused on Ukraine’s debt. The parties agreed not to suspend gas supplies till the next round of tripartite consultations.

On Tuesday, June 3, Gazprom and Naftogaz of Ukraine agreed to negotiate bilaterally, without further mediation by the EU. Ukraine insists on the recalculation of its debt for the gas supplied in 2013 on the basis of a discounted price of $268.5 per 1,000 cubic metres for January-March.

On April 30 Ukraine’s debt reached 3.5 billion dollars.

On April 1, Gazprom cancelled two discounts and raised the price for Ukraine to 485.5 dollars per 1,000 cubic metres.

Ukraine is a transit country for Russian gas exports to Europe that is why such situation can hamper gas supplies to European consumers. In order to avoid supply disruption in May the consultations within the Russia-Ukraine-European Commission format were started in May.

The throughput capacity of the Ukrainian gas transportation is 288 billion cubic metres system at the entrance and 178.5 billion cubic meters at the exit, including 142.5 billion cubic metres to European countries and 3.5 billion cubic metres to Moldova. Ukraine’s gas transportation system consists of 72 compressor stations, 110 production shops and 1,451 gas distribution stations. The overall length of gas pipelines operated by the company is 38,600 kilometres, including 22,200 kilometres of trunk pipelines and 16,400 kilometres of extensions.

 

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