Ukraine offers Russia to modernise its gas transportation system together.
Ukrainian Prime Minister Yulia Tymoshenko arrived in Moscow yesterday for talks with Vladimir Putin. She came to make peace after the scandal over gas accords between Ukraine and the European Union by-passing Russia soured the relations between the two countries. Ms Tymoshenko said that Russia was invited as a key partner in modernising the Ukrainian gas transportation system.
To recap the background, the situation deteriorated when Ukraine and the European Commission signed the so-called Brussels Declaration on modernising Ukraine's entire gas transportation system at the expense of European partners. Modernisation means above all enlarging the capacity of the pipelines to meet Europe's demand for gas, which was set to grow. But who would fill the increased capacity? Ukraine has no gas of its own, it transports only Russian gas. And yet Moscow was not consulted when the declaration was signed.
"Nobody would bring them gas in buckets; the issue has to be solved. We are the main and sole supplier of gas via the Ukrainian pipeline system. When we see that capacity is to increase by 60 billion cubic metres, the question naturally arises, where would the gas come from? We should have been consulted on that score," Vladimir Putin reminded Yulia Tymoshenko yesterday.
The latter had no arguments to trump what the Russian Prime Minister said. Trying to make amends, she announced that Russia too would take part in the modernisation of the Ukrainian GTS. Who will own the whole system?
"The idea of creating a consortium to lease the Ukrainian GTS must be put back on the agenda," Mr Putin said yesterday.
Why "put back"? Because five years ago Gazprom and Naftogaz, the Ukrainian state company, created a gas transportation consortium on the basis of parity. The project never got off the ground. Ukraine wanted the consortium to be responsible only for the building of a new pipeline while Russia wanted it to lease the GTS. Russia does not seek to control the Ukrainian GTS, Vladimir Putin assured Ms Tymoshenko yesterday.
Another piece of news is that Russia will not impose a $2 billion fine on Ukraine for its failure to buy all the gas it had contracted for.
"Ukraine is not fully meeting its obligation to consume gas. But this is not due to sloppiness, but due to the objective situation in which Ukraine finds itself in connection with the world crisis. We are in a similar situation. We understand Ukraine. There is an understanding that Gazprom will not impose a fine. The Ukrainian economy is not in the best of shape," the Russian Prime Minister noted.
Ms Tymoshenko thanked him warmly, but she still did not get the $5 billion Kiev needs to build up stocks of gas. "The issue is being considered," Mr Putin said.
By Anastasia Savinykh