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Nation    

Ukraine trying to jump start natgas talks
Journal Staff Report

KIEV, Dec. 18 – Ukraine will try to accelerate talks with Russia aimed at lower natural gas prices by sending a high-level team of negotiators to Moscow, Interfax reported Sunday, citing a source familiar with the issue.

“Ukraine plans to accelerate the talks,” the source said, adding that a “expanded team” of Ukrainian negotiators was due to arrive in Moscow on Monday.

A spokesman at the Ukrainian government was not available to confirm the report on Sunday.

President Viktor Yanukovych “with a high level of probability” will also travel to Moscow on Tuesday for a meeting with his Russian conterpart Dmitry Medvedev, Interfax reported citing Serhiy Prikhodko, Medvedev’s foreign policy aide.

Yanukovych is due to host a summit between the European Union and Ukraine in Kiev on Monday, according to an announcement on the presidential website. No other announcements have been posted.

Foreign Minister Kostiantyn Hryshchenko said Friday that Ukraine has been trying to reach a compromise with Russia in the gas talks, but has been also to get the European Union more active in the issue.

“We must find mutual understanding with both, Russia and Europe,” Hryshchenko said in an interview with Inter television on Friday. “How to connect this is a very complicated issue. We are working on this.”

The developments come a week after a major setback at the talks between Russia and Ukraine when Gazprom CEO Alexei Miller has suddenly ruled out the possibility of reaching the agreement this month. Gazprom and Ukraine two weeks ago expected to reach the deal by the end of December.

The setback comes after Prime Minister Mykola Azarov, apparently after seeing the final draft of the agreement, has issued his strong objections to the deal.

The final draft agreement called for the creation of two 50-50 joint ventures between Gazprom and Naftogaz Ukrayiny, media reports said.

One joint venture would handle transit of Russian gas to markets in Europe via Ukrainian gas transportation system, while the other one would supply gas to Ukrainian consumers, the newspaper said.

Russia apparently also insisted on registering the gas transit joint venture in a third country to avoid its jurisdiction in Ukraine, according to the newspaper.

Ukraine originally suggested creating a trilateral joint venture, including Ukraine, Russia and the European Union, to operate the gas transportation system, according to a person in the Yanukovych administration.

Azarov last week created a team of negotiators with Russia to make sure Ukraine’s energy security is protected during the talks. The team will be led by Yuriy Boyko, the energy minister, but will also include members of the Foreign Ministry, the Finance Ministry, the Economy Ministry, the State Property Fund and the Justice Ministry.

Ukraine has been seeking to lower gas prices to $230 per 1,000 cubic meters, down from $401/1,000 cu m currently.

The lower price was expected to help Ukraine save $6 billion annually beginning in 2012, but the collapse of the talks means the government will have to either reduce gas imports or cut other spending to balance the budget. (tl/ez)




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