13:26 02.05.2013

EU Commissioner Oettinger: Kyiv, Moscow and Brussels to jointly try to find the optimal, mutually beneficial solution on Ukrainian GTS

An exclusive interview of EU Energy Commissioner Gunther Oettinger with Interfax-Ukraine

Q.: About upcoming roundtable: who, which companies will participate, main goal and what kind of result can we expect?

A.: The participants include some of the main European gas companies, Naftogaz, International Financial Institutions such as the EBRD, EIB, World Bank and IMF as well as private financial bodies. The objective is to examine together the possible evolution of the Ukrainian gas market and its potential and what needs to be done to enhance Ukraine's security of gas supply.

Q.: Have you got confirmation from Russian Gazprom? Have you got any reply?

A.: Both Gazprom and the Russian authorities have been invited to this event. We have not yet seen any official reply from Gazprom.

Q.: Russian Prime Minister Mr. Medvedev said that Moscow can participate in the trilateral GTS only when Kyiv will give up on the EU rules in the energy field. Do you see this kind of scenario?

A.: We believe that the rules that Ukraine is now implementing in the context of its membership of the Energy Community Treaty will permit an open, transparent and competitive energy market in Ukraine that will be to the advantage of Ukraine in terms of its energy security and to both the EU and Russia, notably in ensuring the reliability of the transit of Russian gas to the EU. We believe that a pragmatic solution to ensure the transparent and non-discriminatory management of the Ukrainian GTS can be found in the framework of Ukraine's membership of the Energy Community.

Q.: Do you think that idea about a trilateral GTS still actual?

A.: Three parties have an interest in the future of the Ukrainian GTS – namely Ukraine, Russia and the EU. Russia's gas supply to the EU is still transited mainly through Ukraine. Out of the 138 bcm of gas that was exported to Europe in 2012, Ukraine around 84 bcm transited. We should therefore all discuss together the concerns of each party and try to find the optimal, mutually beneficial solution rather than for one or other party to promote a bilateral approach that excludes one of the interested parties.

Q.: Do you think it makes sense to change the format from the consortium to something different? Or do you see other forms of the cooperation on the Ukrainian GTS or other possibility to involve Russian in to this project?

A.: The possible options for cooperation on the Ukrainian GTS is something that should be discussed between the three parties concerned - namely Ukraine, the EU and Russia – bearing in mind the sovereign interests of Ukraine. The EU is prepared to continue facilitating the involvement of interested EU companies.

Q.: On April, 3 (meeting between president Putin with Gas Prom director Miller) Gazprom declared intention to build 2-nd line of the Jamal-Europe GTS avoiding Ukraine for the delivering a gas to the Central European countries which now receive gas through Ukraine. The main goal, according to Russian leadership, is to exclude Ukraine from transits map of the Europe. What is your opinion on this?

A.: A clear objective of the EU and Russia, as outlined jointly in the "Roadmap to 2050" that was signed in Moscow on March 22, 2013, is that the EU and Russia should be part of a common, subcontinent wide, energy market by 2050. Building a common, integrated market needs to involve all of the countries in Europe and we should try to address the challenges together.

Q.: Recently Gazprom accused Ukraine that reverse gas deliveries for Europe to Ukraine are only paper and not legal. What is you assessment on this?

A.: What we can say from an EU legislative point of view is that gas can flow freely within the EU and the Energy Community and that nothing prevents EU Member States to install physical bi-directional capacity with non EU countries and sell gas beyond EU borders.

Also virtual reverse flows are perfectly in line with the EU and the Energy Community. They are a way of optimizing gas transport and trading within the EU's (and Energy Community's) internal market, and can be executed as swaps between different downstream buyers. This is possible all over the EU and has for example also been implemented in Poland on the Yamal Europol pipeline.

Q.: During last week, Ukrainian government proposed a draft law on the privatization of the “Naftogas Ukraine” and its sub-companies. According to the opposition this law will allow Ukrainian GTS to be privatized to Russia. Is your office aware of this draft law and if yes, what is your assessment on this?

A.: We are aware that a new draft law was submitted to the Parliament at the end of last week and are currently examining it.

Q.: What do you know about interest from some European companies in the Ukrainian underground gas storage? Does the Commission have a plan to coordinate this process or somehow to be involved?

A.: We are aware that some European companies could potentially be interested, provided that a robust, non-discriminatory, transparent and legally-enforceable framework is put in place in Ukraine.

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