Russia Has Paid Ukraine Total Gas Transit Fees For 2009 - Putin

MOSCOW, Russia -- Russia has already paid Ukraine in full for its 2009 gas transit fees, a payment that effectively amounts to a huge loan to the crisis-battered country, Prime Minister Vladimir Putin said Wednesday.

Russian Prime Minister Vladimir Putin

"We pre-paid our Ukrainian partners for the transit of our gas to Europe to the start of next year, 2010, inclusive. Essentially this is a credit of $2.2 billion," he said, quoted by Interfax news agency.

"These are very significant resources which our Ukraine partners have effectively received from Russia," Putin said at a meeting with Alexei Miller, chief executive of Russian state-controlled gas giant OAO Gazprom (GAZP.RS).

"I hope very much that discipline within the framework of existing contracts will be maintained by both sides and in the future," he added.

Russia has warned repeatedly that Ukraine - which has been hit hard by the global economic crisis - will have trouble paying its natural gas bills and that any failure to pay could trigger a repeat of the January gas crisis.

Ukraine says it has the money to pay its bills, and it avoided a looming crisis earlier this month when it paid its May gas bill. However, there is widespread doubt about whether Kiev can pay its next gas bill for June.

In the January gas crisis, a bitter price dispute between Moscow and Kiev caused Gazprom to cut gas supplies to Ukraine, leaving more than a dozen European countries without Russian gas in the middle of winter.

Some 80% of Russian gas exports to the European Union pass through Ukraine.

Source: AFP