Gazprom sets latest gas debt deadline

Feb 28 2008, 02:25

KYIV, Ukraine (AP) — Ukraine’s president, facing a threatened cutoff of natural gas from Russia next week, insisted on Feb. 27 that his country has paid its debt, but Russia’s natural gas monopoly wasn’t satisfied.

Russia’s state­controlled OAO Gazprom says it will cut off exports of Russian­origin gas to Ukraine on March 3 unless the government signs documents on debt payment and future deliveries. Those documents are to formalize an agreement that President Viktor Yushchenko and Russian President Vladimir Putin reached this month to avert another threatened cutoff.

Yushchenko said on Feb. 27 his country has paid its debt for Russian natural gas and “the tension in gas relations with Russia has been eased.”

But Gazprom spokesman Sergei Kupriyanov said Ukraine has only settled its debt for 2007 supplies.

“To pay what one owes for last year is not a heroic feat; there is nothing to be proud of,” Kupriyanov said.

Ukraine imports gas both from Central Asia and from Russia, all of it arriving in Gazprom­controlled pipelines. Gazprom says that about 25 percent of Ukraine’s gas imports are Russian­origin; that is the portion Gazprom says it will cut off if the documents aren’t signed.

Much of the Russian gas consumed in Western Europe comes in pipelines that cross Ukraine. A cutoff by Gazprom to Ukraine in January 2006 caused supply disruptions to Europe.

In the earlier cutoff threat this year, Gazprom claimed Ukraine owed $1.5 billion. But it later said Ukraine owed Russia for an additional 4 billion cubic meters of gas.

Ukraine refuses to pay some $80 million for natural gas consumed in 2006 because Moscow is asking it to pay for those supplies at the 2007 prices, according to the government.

The dispute underlines Ukraine’s dependence on Russia even as Yushchenko tries to move the country closer to the West. Russia is often accused of using its natural resources to bully countries that have political differences with the Kremlin.

Ukraine’s natural gas imports are clouded by going through a series of middlemen. Ukraine buys gas from an intermediary that is half­owned by Gazprom called RosUkrEnergo, which in turn sells it to the Ukrainian middleman UkrGazEnergo, which then supplies it to the national gas company, Naftogaz.

Yushchenko’s statement said the debt had been paid to the intermediaries. It was not clear if those companies in turn had paid Gazprom.

Under the Putin­Yushchenko agreement, the intermediaries are to be eliminated, but will be replaced by two other middlemen companies — each to be half­owned by Gazprom and Naftogaz.

Many Ukrainian officials have sought elimination of all gas intermediaries, which they see as siphoning money into private pockets. Deputy Prime Minster Oleksandr Turchynov on Feb. 27 accused Gazprom of pressuring Ukraine over the debt because of Ukraine’s opposition to middlemen.

“Despite attempts to whip up tensions around the gas issue, the government will continue its policy of bringing the gas market out of shadow, which means elimination of any intermediaries and shadowy criminal schemes,” Turchynov said in a statement

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