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Russia-Ukraine gas dispute

Novak: EU must undertake to guarantee Ukraine’s payment of debts for Russian gas

Ukraine’s debt to Russian state-controlled energy giant Gazprom totals $5.3 billion

BRUSSELS, October 21. /TASS/. The European Union must undertake a commitment to guarantee Ukraine’s repayment of debts for Russian gas, Russian Energy Minister Alexander Novak said on Tuesday after his talks with Ukrainian Minister of Energy and Coal Industry Yuri Prodan and European Energy Commissioner Guenther Oettringer.

He said the European Commission, the European Union’s executive body, has not yet determined sources of financing for repayment of Kiev’s debt.

“We believe possible sources include guarantees of first-class European banks, bridge loans, funds of the European Bank for Reconstruction and Development or the European Commission,” the minister said. The first tranche from the International Monetary Fund will be received by Ukraine only in 2015.

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Oettinger: Ukraine plans to buy 4 billion cubic meters of gas by year end

Gas price of $385 for Ukraine will be in force from October 2014 to late March 2015. Russia suggests to Ukraine signing intergovernmental deal on $100 discount for 2009 contract-envisioned gas price.

Ukraine’s debt to Russian state-controlled energy giant Gazprom totals $5.3 billion, Novak said.

“The debt of Ukraine totals $5.3 billion; out of the sum, $1.4 billion will be repaid by the end of October, and $3.1 billion will be repaid by the end of the year,” Novak said.

Provisional gas deal does not envision possibility to cancel Ukraine’s gas debt for transit of Russian gas, he said. Also ussia to study legality of reverse gas supplies to Ukraine.

Ukraine, which transits Russian gas on to European consumers, currently does not receive Russian gas for its own needs due to an unsettled dispute with Moscow over prices.

Russian state-controlled energy giant Gazprom on June 16 switched Ukraine’s national oil and gas company Naftogaz to prepayment for gas supplies because Kiev failed to pay part of its gas debt by the deadline of 10:00 Moscow Time on June 16.

Gas supplies to Ukraine for its own needs were halted, but transit volumes were reportedly passing via Ukraine to Europe in line with the schedule.

Russian President Vladimir Putin pledged October 17 that Russia will provide enough gas to Europe in winter.

In late 2008 - early 2009, a gas dispute between Moscow and Kiev saw Russia cut off gas supplies to Ukraine on January 1, 2009 over unpaid debts. Gas deliveries to European consumers were affected because Ukraine apparently started siphoning off transited gas. The dispute was resolved on January 18, 2009 with a new gas contract that today’s Kiev authorities want revised.

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Oil & Gas Russia-Ukraine Gas Dispute

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