In Digest, Ukraine

New Cold, Sept 14, 2015

Two news articles are enclosed.

Russia, EU Reach Agreement on Ukraine Gas Supplies

The BRICS Post, Monday, Sept 14, 2015

The leaders of Russia, France, Germany and Ukraine meet in Minsk, Belarus on Feb 12, 2015

The leaders of Russia, France, Germany and Ukraine meet in Minsk, Belarus on Feb 12, 2015

Russia and the European Commission have reached a deal to ensure stable gas supplies to Ukraine and the European Union this winter, Russian Energy Minister Alexander Novak said in Vienna. Novak met with the Vice-President of European Commission, Maros Sefcovic on Friday.

The meeting in Vienna was also attended by Alexey Miller, head of Russian energy giant Gazprom and addressed “issues of ensuring uninterrupted transit of Russian gas to Europe in the autumn-winter period, the implementation of Russian gas transmission projects in Europe” said a Russian Energy Ministry statement.

Officials from both sides confirmed an upcoming trilateral meeting with Russia, EU and Ukraine to finalise a new energy package. Moscow said this meeting could be as early as next week.

Following the meeting, Alexander Novak said Russia is ready to give Ukraine a price discount similar to the one it gives neighbouring countries, such as Poland. The Russian gas discount will take into account the level of prices on the European spot markets.

According to preliminary estimates of Gazprom, the contract price for gas for Ukraine in the fourth quarter of 2015 is $252 per thousand cubic metres, said the Russian Energy Ministry.

The European Commission, in turn, said it might provide Kiev with $500 million for gas purchases of about 2 billion cubic metres (bcm), claimed the Russian Ministry. The commission did not comment on the figure.

Novak said that all participants in the consultations are interested in resuming supplies to Ukraine “as soon as possible.”

Ukrainian officials have previously stated about the need to ensure that gas reserves in underground storage facilities are held at 19 billion cubic meters.

More than a quarter of the EU’s total gas needs were met by Russian gas, and some 80 per cent of it came via Ukrainian pipelines.

“The EU is set to be dependent on Russian gas for some time and that’s the reality,” the International Energy Association’s executive director Maria van der Hoeven had told the European Commission in Brussels in December.

The EU has helped broker two interim deals between the countries after supplies to Ukrainian energy company NAK Naftogaz Ukrainy were halted for almost six months last year over a payment dispute with Russia’s OAO Gazprom.

While Ukraine can cope without Russian gas in the summer, it must boost imports to replenish stocks before the heating season.

(See also brief report on Reuters, Sept 11, 2015.)

Putin, Merkel, Hollande, Poroshenko to hold summit on Oct. 2, 2015

The BRICS Post, Sept 10, 2015

Notwithstanding Washington’s grandstanding on isolating Russian President Vladimir Putin, leaders of France, Germany, Ukraine and Russia have announced an October summit on ending the conflict in Ukraine.

Francois Hollande, Angela Merkel, Vladimir Putin and Petro Poroshenko held a phone conversation on Sept 9 to discuss the violence in Ukraine and “welcomed the maintenance of the ceasefire in southeast Ukraine”, said a Kremlin statement. The four leaders will hold a summit in Paris in October 2.

“Particular attention was given to implementing the political provisions of the Minsk Agreements, first and foremost carrying out a constitutional reform in Ukraine, including legislating special status for the Donbass regions, as well as organising local elections and adopting a law on amnesty. In this regard, Vladimir Putin once again stressed the need to establish a full-fledged, direct dialogue between the Kiev authorities and representatives from southeast Ukraine,” added the Russian Presidency.

Ukraine’s local elections are scheduled to take place on October 25. There are disagreements between rebel groups and the Kiev government over the polls in rebel-held areas of Ukraine.

The Kremlin on Wednesday confirmed that the four leaders had welcomed efforts to maintain the ceasefire in eastern Ukraine. “A withdrawal of armoured vehicles, mortars with a caliber of up to 120 mm and artillery guns with a caliber up to 100 mm along the entire line of contact would facilitate the tasks of de-escalating the situation further and creating pre-conditions for the economic revival of the affected Donbass regions,” the statement said.

“Hope was expressed that a relevant agreement would be agreed upon and put together very soon,” the statement added.

Following talks on Sept 9, a statement from the French President’s office said everything must be done “to make this situation last and allow the OSCE special observer mission to have permanent, safe and unrestricted access”.

Merkel and Hollande also took part in discussions with Putin and the Ukrainian leader on Russian gas supplies to Kiev. [Gas supply agreement reached between Russia and Ukraine.]

The two sides have been locked in dispute for four years over a 2009 contract, under which they agreed to tie the price of gas to the international spot price for oil.

The European Union says that one-fifth to one-fourth of its gas supplies come from Russia via the Ukraine. Six EU countries depend on Russia for 100 per cent of their gas imports.

The four foreign ministers will meet in Berlin on Saturday to come up with “concrete proposals” ahead of the October leaders summit.

Read also:
Leaders from EU, Russia, Ukraine to meet in Paris in October: Kremlin, Reuters, Sept 11, 2015

EU extends sanctions against Russia by six months, Natural Gas Europe, Sept 14, 2015


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