Gas dispute settled
MOSCOW — The Russian and Ukrainian natural gas companies agreed today on a plan to resume gas shipments to Ukraine that allowed both sides to claim victory after a commercial and political dispute that had raised fears of gas shortages in Europe.
The complex pricing plan Russia and Ukraine agreed to drew in a third company: a Russian-Swiss trading business — partly owned by a subsidiary of the Russian natural gas monopoly Gazprom — that will be the sole gas provider to Ukraine.
"The talks ended successfully for Gazprom and Gazprom is completely satisfied," Chief Executive Alexei Miller said as he and Naftogaz head Oleksiy Ivchenko announced the five-year contract.
"We reached an agreement — on mutually beneficial, mutually acceptable terms — that will make it possible to supply Ukraine with the full volume of gas it needs and provide for the transport of Russian gas to Europe," Ivchenko said.
OAO Gazprom will sell gas to the RosUkrEnergo trading company for $230 per 1,000 cubic meters as of Jan. 1 — the price it had wanted to start charging Ukraine.
Ukraine will then buy gas from the company for $95 — nearly twice what it had previously been paying Gazprom, but still far lower than the price it had refused to pay Russia.
RosUkrEnergo can pay and charge the different prices because it also buys gas from the Central Asian nation of Turkmenistan that will be added to the mix, Gazprom spokesman Sergei Kupriyanov said. The Turkmen gas sells for about $50 per 1,000 cubic meters, according to Ukrainian President Viktor Yushchenko.
Kupriyanov said the agreed price for Russian gas was $230 as of Jan. 1 but that it would fluctuate with the market. He did not indicate how often the price would be adjusted.
"Two nations won — Russia and Ukraine; Europe won; it is common sense that won," Ukrainian Prime Minister Yuriy Yekhanurov told reporters in Kiev.
Still, today's agreement looked on balance to be a greater victory for Russia. The deal leaves Ukraine at the mercy not only of market prices, but of Turkmenistan and its mercurial president, Saparmurat Niyazov, who has been trying to raise his country's gas prices.
Europe gets about a quarter of its gas from Russia.
