MOSCOW, May 5 (UPI) -- A merger between Russian energy giant Gazprom and Ukrainian utility Naftogaz could keep Ukrainian transit networks active, Russian energy leaders said.
Moscow is pushing to diversify its gas transit options away from politically sensitive territory in Ukraine with its South Stream and Nord Stream gas pipelines. Around 80 percent of all Russian gas for Europe runs through Soviet-era pipelines in Ukraine.
Kiev, for its part, worries that it would lose out on transit revenue through the rival options, though some opposition forces in Ukraine worry the government may move too close to the Kremlin with alternative deals.
Russian Prime Minister Vladimir Putin proposed merging the two companies in the wake of a revised gas deal in April.
Gennady Shmal, president of the Russian Union of Oil and Gas Industrialists, said a possible merger could save Ukraine from South Stream, the Voice of Russia reports.
Shmal said a merger would mean some gas designated for South Stream would travel through Ukraine instead, cutting construction costs while leaving overall transit volumes intact.
The opposition in Kiev, however, is likely to protest the deal as a brawl broke out in the Ukrainian parliament during the April debate over the new gas deal.
