Ukraine wants long-term gas transit deal with Russia

Ukraine wants long-term gas transit deal with Russia

Ukraine wants a long-term gas transit contract with Russia based on European standards, the prime minister said on Wednesday, adding Kiev would not agree to a short-term deal that Moscow seeks.

“We aim to get a long-term contract, because the continuation of the contract for one year... does not suit us,” Prime Minister Oleksiy Honcharuk told journalists at a briefing.

The existing 10-year deal expires in January and Kiev is concerned that Moscow, which wants a short-term deal, could stop using Ukraine as a transit route when other pipelines are completed, leaving some Ukrainian regions without gas in winter.

Russia and Ukraine, which have been at loggerheads since Moscow annexed Crimea in 2014, failed to agree a new deal at talks in Brussels in September but said they would meet in October with the aim of reaching a deal before the old contract expires.

“It is important for Ukraine to get a new long-term contract because Ukraine and our gas transport system begin to work on European rules,” the prime minister said.

Sources familiar with Russian thinking told Reuters in July that Moscow Russia wanted a short-term deal to buy time to complete other pipeline routes that bypass Ukraine.

Moscow is building new pipelines to Europe, such as Nord Stream-2 and TurkStream, to bypass Ukraine, which is now a major route for Europe’s Russian gas supplies.

Ukraine backs a proposal by European Commissioner Maros Sefcovic for a new 10-year contract guaranteeing a minimum annual transit volume of 60 billion cubic metres (bcm) of gas, with flexibility for an additional 30 bcm.

Honcharuk said the government would “aim to obtain the most favourable conditions in negotiations with the Russian side.”

Ukraine halted its own imports of Russian gas in November 2015. But Kiev typically uses some gas which Russia’s Gazprom pipes across Ukraine to Europe to supply its eastern and central regions, swapping this for gas stored elsewhere.

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