Brussels, 18/06/2014 (Agence Europe) - The European Commission remains open to continuing its trilateral consultations with Russia and Ukraine in order to settle their gas dispute, the press department of European Commissioner for Energy Günther Oettinger told EUROPE on Wednesday 18 June. Oettinger “will assess the ambitions of our Russian and Ukrainian partners in the coming weeks”, it stated. Oettinger first wants to meet Ukraine's Minister for Energy Yuriy Prodan, then Prodan's Russian counterpart, Alexander Novak.
Oettinger will try to bring both parties together again by mid-July, so as to find a solution to settling the Ukrainian debt to Russian gas company Gazprom and to set a price for the supply of Russian gas to Ukraine until spring 2015. The objective is to secure the EU's supply of Russian gas - half of which transits through Ukraine - before peak demand in the winter. “We are in a sensitive situation. We are in June so it's not really urgent today and it's my ambition to use the summer to resolve this crisis”, said Oettinger on 17 June, stating that stocks of gas are currently plentiful and demand is weak.
On Friday, the Gas Coordination Group in the Council will meet to assess the EU's resistance capacity to disruption in supplies transiting through Ukraine, after the Russian decision on Monday to turn off the gas tap to Ukraine.
After a month and a half of intense dealings, the Russian-Ukrainian negotiations - under the mediation of the European Commission - have failed, and contact between two parties was broken off on Monday. The bloodshed in Ukraine last weekend made the task much more difficult. “I think that, at the end of the negotiations, Russia was not thinking to be a little bit more flexible”, Oettinger stated on Monday, as quoted by Reuters.
The Russians and Ukrainians did not manage to come to an agreement on Oettinger's compromise of Ukraine paying $1 billion on 16 June, and then the remainder of its debt in six tranches by the end of the year. This compromise involved a price of $365 per 1,000 m3 of Russian gas for purchases in winter and a price of a little over $300 for purchases in summer - compared with the current price of $485 per 1,000 m3 as laid down in a 2009 contract. Ukraine agreed to the compromise but the Russian party rejected it and insisted on the immediate payment of $1.9 billion and a single purchase price of $385 per 1,000 m3. Gazprom calculates Kiev's debt at $4.45 billion ($1.45 billion for the bills of November and December 2013, and $3 billion for Ukraine's purchases in April and May 2014).
Gazprom also announced on Monday that it was taking the issue of Ukraine's gas debt to the International Court of Arbitration in Stockholm. Kiev responded by announcing that it had launched proceedings with the same court so as to rule on the price. “No one can afford to wait for the years it will take to resolve this difference”, Oettinger said in regard to this.
Although the European Commission is blocking work on building the South Stream gas pipeline in the countries which are stakeholders in this Gazprom-led South Stream project (Austria, Bulgaria, Croatia, Greece, Hungary, Slovenia and Italy - plus Serbia), while its compatibility with EU legislation is assessed, Oettinger said on Tuesday that this issue had not been raised in the negotiations with Kiev and Moscow. (EH)