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Kiev talks of new Russian gas prices

KIEV, Ukraine, March 12 (UPI) -- The new government in Ukraine aims to focus on finding an optimal price for natural gas it purchases from Russia, the Ukrainian prime minister said.

Ukrainian President Viktor Yanukovych named his longtime ally Mykola Azarov prime minister when he formed a coalition government Thursday.

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Azarov said that as Kiev examines its budget for 2010, he would lobby for better Russian gas prices, Russia's ITAR-Tass news agency reports.

"Our talks with Russia will focus on an optimal gas price that Russia supplies us," he said.

Russian energy giant Gazprom cut gas supplies to Ukraine briefly in 2009 because of a spat over prices and contracts. That row left European customers in the cold as 80 percent of their Russian gas travels through Soviet-era pipelines in Ukraine currently.

The Ukrainian economy was hammered by the 2009 recession, forcing Kiev to look to the International Monetary Fund for help with its gas payments. National energy company Naftogaz was declared close to bankruptcy in December.

Azarov said he would "put things in order," including Naftogaz. "We shall continue structural reforms which were suspended (in the previous government)," he added.

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