KIEV, July 27 – Russia is seeking to add new battleships and submarines to its Black Sea Fleet based in Ukraine and may use natural gas leverage to impose a respective agreement.

Ukraine has resisted for the past 10 years Russia’s pressure to replace its aging fleet with the new battleships, but the parties have now entered the final stage of negotiations.

“The formulation of this agreement has entered the final stage,” Aleksandr Fedotenkov, the commander of the Black Sea Fleet, said, quoted by BBC Ukraine. “We expect to sign the agreement by the end of the year. It will give us an opportunity to add new battleships.”

Russia has been seeking to upgrade its BSF by increasing its firepower as a response to NATO’s expansion to former Communist countries in Eastern Europe, such as Bulgaria and Romania. Russia views NATO as a military threat.

Russia hopes to add the first new battleship to the fleet in 2014, including frigate Admiral Kasatonov and a new diesel-powered submarine, according to Russian officials.

A deal between Russia and Ukraine, signed in 1997, allowed the stationing of the Black Sea Fleet in Sevastopol for 25 years, but had not anticipated a legal way for Russia to replace the aging battleships.

That led to the number of battleships stationed in Ukraine shrinking to less than 100 compared with about 300 in early 1990s, reducing the importance and firepower of Russia’s navy in the region.

Ukraine has so far objected to the massive increase in BSF firepower and has suggested a gradual replacement of aging Russian battleships with battleships that have similar capacities.

Konstantin Zatulin, a former Russian nationalist lawmaker and an outspoken supporter of Russian interests in Ukraine, said Moscow will use its dominance in the natural gas sector to force the new agreement.

“Russia’s influence on the Ukrainian economy is a major negotiating argument that will finally force the Ukrainian party to speed up the agreement on upgrading to the aging Black Sea Fleet,” BBC Ukraine reported, citing Zatulin.

Ukraine has unsuccessfully for the past two years tried to renegotiate a 10-year gas agreement with Russia, seeking lower gas prices. Ukraine seeks to cut the prices to $230-250 per 1,000 cu m compared with $425/1,000 cu m it currently pays.

But the most recent round of talks between President Viktor Yanukovych and Russian President Vladimir Putin have failed to reach any agreement, with Moscow reportedly demanding political concessions from Kiev.

Russia already used its natural gas sector monopoly in April 2010 to extend the stationing of its BSF in Sevastopol for another 25 years through 2042.

Russia agreed to provide $100/1,000 cu m discount on gas prices for the next 10 years, in exchange for extending the stationing of its fleet for another 25 years.

Ukraine’s opposition groups said the deal violated the country’s constitution, and called for the impeachment of Yanukovych. (tl/ez)