Gazprom Cuts Off Gas Supplies to Ukraine
In line with its threat, Gazprom is cutting off the gas supplies to Ukraine. Moscow speaks of the 25-percent reduction, while Kiev gives 35 percent. Russia’s gas monopoly has to maintain at least 60 percent of supplies, as they are made under direct contracts with the clients of Ukrgaz-Energo, where Gazprom controls 25 percent. At the same time, Ukraine has confirmed the availability of a month reserve in the underground storage facilities. Therefore, it would be a long conflict unless Ukrainian Prime Minister Yulia Tymoshenko executes her threat and winds up Ukrgaz-Energo. Should it happen, Gazprom will probably aggravate the problem by halting all supplies to Kiev.
Gazprom reduced by a quarter (40 million cu meters a day) the gas supplies to Ukraine at 10:00 p.m. MSK yesterday. “In Ukraine, the unexecuted consumption of gas continues, the required contracts haven’t been signed. Without any contract, Ukraine has accumulated some 1.9 billion cu meters of Russia’s gas worth roughly $600 million. The agreements determining procedures for further gas cooperation haven’t been inked either,” said Gazprom spokesman Sergei Kupriyanov.
Andrei Knutov from Rosukrenergo said the restrictions will affect fist and in whole not the direct contracts of Ukrgaz-Energo but rather Naftogaz. Gazprom owns 50 percent in Rosukrenergo, Dmitry Firtash controls 45 percent and Ivan Fursin owns 5 percent. The company supplies gas to Ukrgaz-Energo, which it owns parri passu with Naftogaz, and Ukrgaz-Energo resells gas to Naftogaz and consumers in the next move.
“We are sure the restriction won’t extend to the clients of Ukrgaz-Energo. As of February 29, 2008, the company had customs clearance for the natural gas in amount sufficient for continuous gas supplies to all consumers that entered into contracts with Ukrgaz-Energo and are paying under them in appropriate way,” confirmed Andrei Galushchak, an advisor to Ukrgaz-Energo board chairman.
Naftogaz buys from Ukrgaz-Energo 14 billion cu meters of gas a year, i.e. exactly about 25.5 percent of 55 billion cu meters. Ukrgaz-Energo directly works with industrial consumers (32 billion a year), leaving to Naftogaz the social field, including housing and communal enterprises. So, Gazprom's direct interest in domestic market of Ukraine has been secured against the halt of all gas supplies.
But in Naftogaz, they aren’t particularly agitated either, claiming they have enough gas to last for a month. The tricky point is that, according to the sources, exactly Rosukrenergo and Ukrgaz-Energo are the owners of all gas kept in Ukraine’s underground storage facilities, to which Naftogaz refers as the gas reserves.
www.kommersant.com
All the Article in Russian as of Mar. 04, 2008
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