11:43 07.11.2013

Ukraine to reduce purchases of Russian gas to minimum, says Boiko

3 min read
Ukraine to reduce purchases of Russian gas to minimum, says Boiko

If Russia retains its formal approach to gas contracts, Ukraine will reduce purchases of Russian gas to a minimum to meet its domestic needs only, Deputy Ukrainian Prime Minister Yuriy Boiko has said.

"In October, we actually were using gas we had in our storage facilities for public utilities, and we do not plan to take large volumes of gas from Gazprom. We will take smaller amounts, for which we have enough money. And in the future, if our partners retain such a formal approach, we will also be caring only for our public utilities. Whereas, we will treat the task of ensuring support of gas transit by Naftogaz Ukrainy for Gazprom during the peak time as optional," he said at the press conference in Kyiv on Thursday.

In the winter heating period, Ukraine pumps gas imported from Russia into underground storage for two reasons: to amass the required reserve to cover unforeseen circumstances and as insurance to support transit of Russia gas to Europe during periods of extreme cold.

Naftogaz Ukrainy plans to pump about 1 billion cubic meters of gas into underground storage in November, to boost inventories to 19.1 billion cubic meters, Naftogaz Deputy CEO Vadym Chuprun said at the end of October.

On November 2, Boiko said that Ukraine would buy just 11 billion cubic meters of gas from Russia in 2013, down from 40 billion cubic meters it was importing from Russia just three years ago.

"We have reduced purchases under this contract," Boiko said.

On November 4, Boiko said Ukraine would reciprocate if Russia maintains its formal approach on the gas issue. "If there is a formal approach on the part of our Russian colleagues, we reserve the right to use the contract only for purchases, and the entire responsibility for gas transit to Europe from Gazprom will rest on them alone. We aren't going to back them up, because if there is a formal approach from their side, there will be the same formal approach from our side," he said.

The next day, on November 5, Gazprom spokesman Sergei Kupriyanov said that Ukraine was making payment for gas delivered in August, but that it was just a small part of the overall debt of $882 million. "Some payments are coming in, but these are so far drops in the ocean and at this rate it will be a very long time before it is paid in full," Kupriyanov said.

As of November 6, Naftogaz had reduced the debt to Gazprom to $792 million.

Speaking to journalists in Kyiv earlier on Thursday, Naftogaz CEO Yevhen Bakulin said the company plans to buy no more than 18 billion cubic meters of gas from Gazprom in 2014.

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