Ukraine optimistic about new gas deal

Feb. 21, 2012 at 9:01 AM   |   Comments

KIEV, Ukraine, Feb. 21 (UPI) -- A Ukrainian official said Kiev expected to work out an "optimal" revision to a 10-year natural gas deal signed with Russian energy company Gazprom.

Gazprom sends 80 percent of its natural gas designated for European countries through the Soviet-era transit network in Ukraine. Both sides in 2009 signed a 10-year supply contract that ended a simmering debt dispute, though Kiev now says that deal is crippling an economy already battered by recession.

Ukrainian National Defense and Security Council Secretary Andriy Klyuev told Bloomberg News ongoing talks with the Russians were "dynamic."

Ukrainian officials had said they would reduce the amount of gas it secures from Russia, though the contract is based on a take-or-pay scheme. The government wants to revise the 2009 deal so it's paying $250 per 1,000 cubic meters of gas, down from the $416 it's paying now for that volume.

"I expect both sides will work out an optimal, economically grounded and fair gas price formula for Ukraine," Klyuev was quoted as saying.

Opposition leader and former Ukrainian Prime Minister Yulia Tymoshenko is serving a sentence in prison following a conviction on corruption charges related to the 2009 natural gas deal with Gazprom.

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