Brussels, 23/03/2015 (Agence Europe) - During their meeting in Brussels on Friday 20 March, the Russian and Ukrainian energy ministers, Alexander Novak and Volodymyr Demchyshyn respectively, agreed - under the mediation of European Commission Vice-President for Energy Union Maros Sefcovic - on the agenda for talks concerning an arrangement for a post-winter package on the supply of Russian gas to Ukraine. The current winter package expires on 31 March, and the Commission hopes for a new meeting by the end of April.
In the terms of a joint statement, Russia will assess the possibility of granting Ukraine a rebate on its gas deliveries, Ukraine will ensure it creates enough reserves to be able to guarantee the transit over its territory of Russian gas headed for Europe, and the Commission will assess how to help Ukraine find the appropriate financial support to buy the gas. The three parties agreed that a specialist group will put forward a proposal at the next trilateral meeting in April.
“We're currently looking for possible dates for a new meeting and hope to hold it by the end of April”, a Commission spokesperson said on Monday 23 March.
In a statement from the Ukrainian ministry for energy over the weekend after this meeting, Demchyshyn said he hoped for a rebate on the price of Russian gas which would bring the price to $250 per 1,000 cubic metres in the second quarter. In an interview on Russian television, Novak confirmed that the price of gas for Ukraine would be $50-80 below the rate paid by Ukraine in first quarter ($329 per 1,000 cubic metres), given the fall in oil prices.
The Commission wants to come to an arrangement (in June at the latest) for Ukraine to be able to create its gas reserves by next winter. Ukraine's gas reserves are expected to fall to 6.5 billion cubic metres in April, but the required level for ensuring the continuous transit of Russian gas to Europe is 20 billion cubic metres. This is an imperative, as nearly half of the Russian gas consumed in Europe transits Ukraine. Until then, once the winter package has expired, Ukraine's gas supply can be assured by reverse gas flows in the pipelines that link Slovakia, Poland and Hungary.
The EU also wants to obtain a long-term agreement from Russia and Ukraine until the end of 2016 - the date when the Stockholm international arbitration court will make its ruling on the old dispute taken there by Ukrainian gas company Naftogaz and Russian gas company Gazprom over Ukraine's arrears. After the fall of Ukraine's former president Viktor Yanukovych at the start of 2014, Russia decided to increase the price of gas sold to Ukraine, then broke off its deliveries in June 2014 as Kiev had not been able to settle its debt for several months. The winter package concluded under the mediation of the European Commission in October 2014 enabled Ukraine's supply of Russian gas to be resumed. (Emmanuel Hagry)