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Russia, Ukraine agree to kick-start stalled gas talks

Russia, Ukraine agree to kick-start stalled gas talks
​Leaders of Russia and Ukraine have decided to resume talks on energy issues between the two countries in September, as fears of gas delivery disruptions and Kiev's unwillingness to settle disputes and pay bills threaten Europe’s energy security.

Following an intense round of direct talks between President Vladimir Putin and his Ukrainian counterpart Petro Poroshenko, the head of the Russian state said that both leaders were able to reach an agreement on the resumption of consultations on energy and gas.

Yet Putin said, there are “a lot of concrete questions,” stressing that while Russia fully complies with all the conditions of the gas contracts with Ukraine, the actions of Naftogaz create risks for gas transit to Europe.

In June, Russia’s national gas company Gazprom stopped gas deliveries to Ukraine over chronic late payment and an unpaid bill of over $5 billion.

“We believe, just as President Poroshenko, too, that it is essential to resume our dialogue on energy, including gas-related problems,” Putin said. The gas supply issue is currently “in a deadlock,” the Russian leader said, “but all the same it is necessary to discuss it.”

“It has been agreed that the Contact Group must resume its work as soon as possible,” Putin said, adding the EU is also interested in the discussions.

Meanwhile, the EU's Commissioner on Energy, Guenther Oettinger emphasized the need of “reaching an intermediate agreement on gas,” without awaiting the verdict from the Stockholm arbitration court. In June, after Gazprom switched Naftogaz to a prepayment plan, both companies have filed lawsuits against each other at the Stockholm Arbitration Court.

Reuters / Konstantin Grishin

However for now, Oettinger stressed, the EU is not worried about potential problems with gas deliveries to Europe via Ukraine. “There is no actual concern,” he said on the sidelines of the Customs Union-Ukraine-EU meeting in the Belarusian capital.

Ukrainian Energy Minister Yuriy Prodan, however, claims the reliability of Russian gas supplies to Europe depends solely on Gazprom, as Ukraine has no transit contracts with European states.

“At the moment, Gazprom is the only one who is responsible for the gas transit. Who signed contracts with European companies? Gazprom did. The Ukrainian gas transit operator has no contract with Europeans at present,” he said.

Russian Energy Minister Aleksandr Novak said that Moscow is not planning to discuss amendments to terms of the transit agreement after the three-party talks resume.

“We have not discussed this today. … But our position is as follows: the transit contract is in force until 2019 and it cannot be reviewed at least till that time," the energy minister said, noting that Russia does not consider the possibility of the EU purchasing its gas at the Russian-Ukrainian border.

The next round of talks on the gas issue will be held in September, President Poroshenko announced. “It is agreed that on September 6 the next consultations on energy issues with the participation of the European Commissioner Oettinger and Minister of Fuel and Energy of Russia and Ukraine will be held.”

Ukraine imports nearly 50 percent of its gas from Russia, which in 2013 amounted to 27.7 billion cubic meters. If Ukraine cut off Russian gas transit, it would hit Europe, which sources 15 percent of its energy from Russia.

For more watch Irina Galushko's report: