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Russia, Ukraine sign contract on gas supplies for 2009-2019

RIA Novosti

19/01/2009 19:52 MOSCOW, January 19 (RIA Novosti) - Russian energy giant Gazprom and Ukrainian energy company Naftogaz signed on Monday a contract on Russian gas supplies to Ukraine for 2009-2019.

Russian Prime Minister Vladimir Putin said Moscow and Kiev had reached agreement on all issues of gas transit and supplies.

He added that there would be no intermediaries in Russian-Ukrainian gas relations.

Putin said Gazprom had been ordered to restart full natural gas transit to Europe via Ukraine.

Putin and his Ukrainian counterpart, Yulia Tymoshenko, agreed Sunday in Moscow on a gas price for Ukraine for 2009 and gas transit tariffs. The deal would see Kiev paying 20% less than the European market price, expected to be around $450 per 1,000 cubic meters in the first quarter.

Ukraine paid $179.5 per 1,000 cubic meters of gas in 2008. Gazprom had insisted on a market price of $450 for 2009.

Russia suspended supplies to Ukraine on January 1 after the former Soviet neighbors failed to agree on debt and prices for 2009. A week later, Gazprom cut off gas deliveries to the European Union, saying Ukraine was stealing gas intended for EU consumers, an accusation Kiev denied.

Following mediation by the EU, the two sides signed a deal a week ago to resume supplies, but deliveries did not restart, with each side blaming the other for the lack of progress. Almost 20 countries in Europe have been affected by the dispute. The EU has called the cut in supplies "completely unacceptable."

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