Monday, September 29, 2014

Ukraine’s Naftogaz calls for new gas transit deal with Russia

BERLIN, September 29. /ITAR-TASS/. Ukraine cannot guarantee reliable Russian gas transit supplies through the country, Ukrainian state-run oil and gas holding Naftogaz CEO Andriy Kobolev said in an interview with German business daily Handelsblatt on Monday.
“We urgently need a new transit treaty, otherwise, we cannot guarantee non-stop (Russian gas) transit through Ukraine,” he said.
Ukraine needs transit contracts which would be concluded between Naftogaz’s subsidiary Ukrtransgaz, Russian energy giant Gazprom and Eustream, operator of the gas transmission system which would represent European interests.

The signing of a new addendum to the contract between Gazprom and Naftogaz (if all parties to the deal agree on new terms of supplies) does not secure non-stop Russian gas transit delivery to Europe, because Ukraine did not pump necessary gas amounts in underground storages, Gazprom CEO Alexey Miller said last Saturday. Seven billion cubic metres of gas should be pumped to reach a 17 bcm comfortable level for this autumn and winter. Miller is convinced that if harsh frost sets in, Ukraine may start taking gas from Russian gas supplies to Europe.

A new package deal which was discussed at a tripartite meeting in Germany’s capital Berlin on September 26 offers Ukraine to repay $3.1 billion of debt to Gazprom for already delivered gas before the end of the year. 

In this case, Gazprom will deliver five bcm of gas to Ukraine and will give an option for another five bcm. The gas price will make $385 per 1,000 cu m thanks to a $100 discount which is granted only for six months. On September 26, Ukrainian Prime Minister Arseniy Yatsenyuk confirmed a preliminary agreement to conclude a package accord before the end of Stockholm arbitration proceedings.
Meanwhile, the issue of Ukraine’s debt repayment is unclear. Russia and the EU share the position that $2 billion should be repaid before the end of October, the Gazprom CEO said. However, at talks Ukrainian Energy Minister Yuriy Prodan insisted on paying $1.5 billion only at the end of the first month of Russian gas supply to Ukraine (in October) if the delivery is resumed.
Next gas talks between officials from Russia, the EU and Ukraine are expected to be held on October 2.

Gas transit via Ukraine
  • The throughput capacity of the Ukrainian gas transportation is 288 billion cubic meters at the entrance and 178.5 billion cubic meters at the exit, including 142.5 billion cubic meters to European countries and 3.5 billion cubic meters 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 kilometers, including 22,200 kilometers of trunk pipelines and 16,400 kilometers of extensions.

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