Ukraine ready in case transit of Russian gas stops

Ukraine's Minister of Energy and Environmental Protection Oleksiy Orzhel speaks to the press after a Trilateral Gas Talks between the European Union, Russia and Ukraine at the EU Commission headquarters in Brussels, Belgium, 28 October 2019. [Stephanie Lecocq/EPA/EFE]

Ukraine is ready for the gas transportation being stopped on the Ukrainian territory in case a new gas transit contract with Moscow is not negotiated, Ukraine’s Energy Minister Oleksiy Orzhel announced on Monday (4 November). The current gas contract expires on 31 December.

EU-mediated talks about the gas contract are currently in a deadlock. The EU has invested a lot of effort into preserving Russian gas transit across Ukraine, despite the emergence of two Gazprom-sponsored big pipeline projects aimed at bypassing Ukraine: Nord Stream 2, across the Baltic Sea, and Turkish Stream, across the Black Sea.

EU-mediated Russia-Ukraine gas talks in deadlock

Russia and Ukraine need a sense of urgency in their talks on gas transit for Europe, the European Union’s energy chief said after the latest round in Brussels on Monday (28 October) failed to yield progress.

“We are ready for the situation of gas transportation being stopped on the Ukrainian territory”, Orzhel said during a television appearance, as quoted by Ukrainian media. Ukraine is ready for the heating season and “will be able to go through the winter without transportation and supply of gas.”

However, the minister underscored that finding a solution remains important. “It is a priority for Ukraine to receive funds for the transit. We are working very actively with our European partners to sign a contract with Gazprom according to new European rules.”

The comments came after Denmark cleared a major hurdle for the completion of Nord Stream 2. Russia also stepped up negotiations with partners for the Turkish Stream pipeline, including Hungary, a country maintaining cosy relations with the Kremlin.

Denmark clears major hurdle for Russia's Nord Stream 2 gas pipeline

Denmark gave the go-ahead to the Nord Stream 2 gas pipeline on Wednesday (30 October), removing the last major hurdle to completion of the Russian-led project that has divided opinion in the EU.

There seems to be no direct threat for EU consumers in case transit via Ukraine were to stop, at least in the short term. During the EU-mediated energy talk in Brussels on 28 October, which ended in a deadlock, European Commission Vice-President Maroš Šefčovič said the EU is also fully prepared for any eventuality. EU underground gas stores are stocked at 90-96%.

The EU energy chief hinted that Russia sought a “package solution” also including a “political” solution over the results from the Stockholm arbitration in February 2018, and that Ukraine was not ready to discuss this issue.

The Ukrainian Naftogaz emerged the net winner of that ruling, gaining $2.56 billion from Gazprom though the Russian firm is challenging the decision.

“We use the rules that are operational in Europe,” Orzhel said. “This means we cannot be blackmailed.” The trilateral talks will continue at the end of November.

Asked to react to Orzhel’s statement, Commission spokeswoman Mina Andreeva said the EU executive doesn’t comment on comments.

The EU wants to preserve gas transit via Ukraine to the benefit of this country, as transit fees are very lucrative.

[Edited by Georgi Gotev and Zoran Radosavljevic]

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