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Russia and Ukraine OK with EU law for gas transit

Russia and Ukraine OK with EU law for gas transit

Brussels, September 20 - Neftegaz.RU. Russia, Ukraine and the European Commission held trilateral gas talks at a political level on the long-term transit of Russian gas via Ukraine to Europe as of next year with both sides agreeing in principle that a future contract should be based on EU law, EC Vice President for Energy Union Maroš Šefčovič said, adding that Ukraine is gradually implementing EU energy rules. He also noted that Russian gas monopoly Gazprom is well acquainted with them in its commercial relations.

The Commission wants to secure reliable and uninterruptible Russian gas transit through Ukraine into EU countries. The current gas transit contract between Ukraine’s Naftogaz and Gazprom is valid until the end of December 2019. In 2018, 40% of gas supplied by Russia to the EU was delivered within this contract.

Šefčovič noted that the length of a future contract, volumes and the tariffs setting to be now addressed during inter-ministerial consultations with Gazprom and Naftogaz participating. “We have agreed to return to the table at political level by end of October,” he said.

According to Šefčovič, Russia, Ukraine and the EU addressed how EU energy rules should be reflected in the legal framework of a future contract, the appropriate duration of such contract, necessary volumes and their flexibility, the tariff setting and the Stockholm arbitration.

The Commission VP said he appreciated “a constructive approach” of Ukrainian Minister for Energy Oleksiy Orzhel, Russian Energy Minister Alexander Novak as well as Naftogaz CEO Andriy Kobolev and Gazprom CEO Alexey Miller. “There was positive atmosphere in the room. We have taken steps in the right direction today. In other words, there has seen convergence of positions on some of the issues,” Šefčovič said.

“Firstly and importantly, both sides have agreed in principle that a future contract will be based on the EU law. We have clearly described to the Russian side that Ukraine is gradually implementing EU energy rules and a future contract must respect them,” he said. “At the same time, Gazprom is well acquainted with EU rules in its commercial relations with European gas companies. This would therefore be a well-known territory,” he added.

“Concerning the duration of a future contract, volumes and the tariffs setting, we have had convergence of minds. We need an agreement on all 3 elements, as they are interlinked. The volumes are key for the tariffs setting. The duration of a future contract is important for investment into the Ukrainian transit system,” Šefčovič said.

Turning to preparations ahead of this winter, he assured that that EU underground storage filling levels are very good – currently standing at 96% of full capacity. Ukraine’s underground storage filling levels are also good – currently at around 19.6 billion cu m, almost 4 billion cu m above levels in September last year, he said.

He said political talks would resume by the end of October “when, I hope, we will have more progress on the remaining issues. We will remain in contact in the meantime. With Ukraine, we will work closely on the unbundling and certification process as well as on the transposition of EU legislation into the Ukrainian law.”

To read the full story in Russian.

Author: Kostis Geropoulos

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