Natalya Grib, Oleg Gavrish, Kiev
Can Ukraine survive the winter without Russian gas?
Russia may reduce its gas supplies to Ukraine if Kiev fails to sign a long-term agreement on 3-year transition to market prices, or begins siphoning off transit gas going through its territory to other countries in Europe. Ukraine's Naftogaz, which owes Rosukrenergo over $2 billion, does not have enough money even for the first installment of $550 million. Meanwhile, Ukraine has a four-month gas reserve in underground storage.
Answering questions from Russians in the question-and-answer session yesterday Prime Minister Vladimir Putin said that Russia was continuing the "difficult discussions" on gas supplies in 2009 with the Ukrainian partners. Putin has reached agreement with Ukrainian Prime Minister Yulia Tymoshenko on Ukraine's gradual 3-year transition to market prices, but only after the debt of more than $2.5 billion is paid off. Rosukrenergo, the mediator in the Russian gas supplies to Ukraine 50% of which is owned by Gazprom, told Kommersant that Naftogaz paid only $268.7 million for the gas supplies in September and had not paid $2195 million including penalties for October and November, or $862.3 million for December supplies.
In 2008, Ukraine will get nearly 55 billion cubic meters of gas at the price of $179.5 for 1,000 cubic metres, while the price in Europe has risen from about $270 to $500 since the beginning of the year. Earlier Gazprom promised that if Ukraine failed to pay off its gas debts, the price would rise to over $400 for 1,000 cubic metres starting in 2009.
The two parties held debt talks in Moscow on Tuesday and Wednesday. They have not commented on the outcome. A source familiar with the talks says Gazprom has granted Naftogaz an extension, without setting a new deadline for payment. The gas monopoly has not made sharp statements about the debt: Prime Minister Putin has assumed this responsibility. He expressed hope that "there would be no problems with the transit of our energy supplies to the customers in Western Europe." "But if our partners do not abide by these agreements or, as in the past, will siphon off our resources from the transit pipeline without permission, we will have to reduce the supply," warned the Russian prime minister.
Vasily Kiselyov, the head of the parliamentary ad hoc commission on investigating the gas market situation, believes that "Prime Minister Putin cannot understand that Naftogaz does not have sufficient funds to pay for gas." The Ukrainian authorities have already allowed Naftogaz to postpone its tax payment until the middle of 2009, and the company itself has ordered 87 out of 170 enterprises in the heating and energy sector consuming 30 billion cubic metres of gas per year be switched off. But this can help Naftogaz only to reduce consumption in December.
"The talks can continue for a long time without any positive result, Kiselyov said. "A crucial issue for the Naftogaz management is to gain time to avoid a gas war as long as Yulia Tymoshenko is prime minister. But as soon as the parliament has been dissolved (which may happen in December) and the company gets new management, the conflict will enter an active stage."
Oleg Zarubinsky, a member of the Ukrainian parliamentary committee on the fuel and energy complex, thinks that nobody in Ukraine believed Putin's ultimatum. "The threat of switching off gas has gotten old and Kiev is no longer afraid of it, especially since the Ukrainian gas storage facilities are filled to capacity," said the MP. Ukraine's underground gas storage has 28-30 billion cubic metres of gas, while the country consumes 74 billion cubic metres a year.