Gas payment dispute still not resolved

Gazprom and E.ON of Germany will build gas-fired power stations together. Russia's gas monopoly plans to sell electricity from the project. Meanwhile Gazprom says it may still cut gas supplies to Ukraine by 25% from March 3.

The comments come as Friday talks between the two sides over a payment dispute failed to bring any results.

The gas giant said Ukraine has still not fully paid for its gas consumed in 2007.

According to Gazprom, Kiev has consumed more than $US 600 millions worth of unauthorized gas. However, the possibility of talks continuing over the weekend wasn’t ruled out.

The two sides have failed to agree on the finer terms of a settlement deal, which was reached at talks earlier this month between the Presidents of Russia and Ukraine.

Gazprom to sell electricity in Germany

E.ON signed a memorandum in Dusseldorf with Russia's gas monopoly to build gas-fired power stations.

A turbine plant will be built in Lubmin in Mecklenburg-Vorpommern where the NordStream pipeline enters Germany – using the gas supply.

Gazprom says it will be involved in every stage of the project from supplying the gas to selling the electricity generated by the power plant.