Ukraine's Yanukovych Pledges Reliability For Russian Natural Gas Transit

BRUSSELS, Belgium -- Ukraine will never again let a dispute with Russia cut off supplies of natural gas to European customers, President Viktor Yanukovych said.

Ukraine's President Viktor Yanukovich (L) is welcomed by European Commission President Jose Manuel Barroso (R) ahead of a meeting in Brussels September 13, 2010.

“This will never happen again,” Yanukovych told reporters today after meeting European Commission President Jose Barroso in Brussels. “Ukraine is obliged today to comply with its commitments to the European Union, to Russia as a transit country, as regards the reliability and stability of the work of its gas transportation network. This is an obligation we will comply with always.”

The 27-nation EU gets about a quarter of its gas from Russia, 80 percent of which flows via Ukraine.

A pricing dispute between OAO Gazprom and NAK Naftogaz Ukrainy in January last year left more than 20 countries in Europe without gas for almost two weeks in freezing temperatures.

Relations between Ukraine and its eastern neighbor improved after Yanukovych took office in February, replacing President Viktor Yushchenko, who won power on promises to bring Ukraine into the EU and the North Atlantic Treaty Organization.

Ukraine now has to focus on overhauling its gas sector, Barroso said. The country needs to cut energy costs as it phases out subsidies to comply with a $15.2 billion loan program from the International Monetary Fund.

Russia and Ukraine are seeking to create a venture that would give Moscow-based Gazprom joint control of a pipeline to southeastern Europe in exchange for access to natural gas supplies for Naftogaz.

The agreement would reduce the price Ukraine pays for Russian gas, Prime Minister Mykola Azarov said earlier this month.

The east European country signed a deal with the EU to jointly start work on upgrading its pipelines, Yanukovych said today. Ukraine also invited Russia and partners from other countries, he said.

Source: Bloomberg

Comments