Ukraine Banned RosUkrEnergo From Supplying Gas to Europe

Ukraine has banned Rosukrenergo (where Gazprom owns 50 percent) from exporting the gas outside the country, stripping it of the last profit-generating tool.

People in Naftogaz say that the purpose is to prevent the repetition of the January crisis, when Rosukrenergo sold 1.5 billion cu meters of cheap gas to Europe and Gazprom offered the expensive gas of Russia as a substitute, Kommersant reported.

Naftogaz briefer Valentin Zemlyansky said yesterday he himself saw the March 12 ruling of the cabinet dedicated to the sale of imported natural gas in Ukraine. The document specifies that, starting from January 1, the gas of Rosukrenergo could be used exclusively to meet the demand of Ukraine in line with the gas balance of 2008.

The key purposes of the ruling, Zemlyansky went on, are to secure the fuel and energy balance of Ukraine that provides for importing 55 billion cu meters of gas a year and to avoid the crisis similar to the one happened in January when Gazprom demanded from Ukraine to pay $314 per a thousand cu meters to $321 per a thousand cu meters for $1.5 billion of Russia’s gas.

Ukrainian News reported that the same ruling of the cabinet committed the State Customs Service of Ukraine to preliminary clear the gas supplied to the gas transport system at the price of $179.5 per a thousand cu meters for Naftogaz exclusively.

Zemlyansky said that Naftogaz will ensure the transit supplies under all foreign contracts. The official didn’t exclude the scenario, whereby Rosukrenergo would buy gas from Naftogaz on border of Ukraine and Poland for selling in Europe. Rosukrenergo supplied 10.2 billion cu meters to the EU in 2007.

Meanwhile, Europe’s clients of Rosukrenergo expect the new initiative of Ukraine to break their gas contracts and trigger a scandal at the EU level.