Ukraine sticks Russia with massive gas bill

Eastern European country demands $3.5 billion from Russian Gazprom for abusing the 'monopoly status' it enjoys on gas transits

Ukraine sticks Russia with massive gas bill

World Bulletin / News Desk

Ukraine on Friday stepped up its economic warfare with Russia by demanding a mult-billion-dollar payment from the Gazprom gas giant for allegedly underpaying Kyiv for its fuel transits to European states.

The gesture is largely symbolic because Russia has dismissed similar Ukrainian claims.

But it underscores the severe tensions between the two neighbours and potentially complicates the resolution of a litany of existing trade disputes.

The westward-leaning former Soviet country's Anti-Monopoly Committee said Gazprom had two months to pay 86 billion hryvnias ($3.5 billion / 3.2 billion euros) for abusing the "monopoly status" it enjoys on gas transits through Ukraine.

The committee's deputy chief Mariya Nyzhnyk said the sum represented 30 percent of the price for natural gas that passed through the country over the past five years.

"Another complication is that these violations are continuing today," Ukrainian media quoted Nyzhnyk as saying.

There was no immediate response from either Russian officials or Gazprom.

Ukraine's decades-old pipelines account for about 15 percent of all gas imported by the European Union -- its members reliant on Russia for about a third if their outside supplies.

Some of Gazprom's EU clients saw their deliveries limited in 2006 and 2010 when the state-run behemoth — long accused of raising the rates of neighbours who want to ease their dependence on Moscow — halted supplies to Ukraine over price disputes.

Kyiv's announcement came just three days after Gazprom itself demanded the payment of a previously-undisclosed $2.55 billion bill for the July to September period of 2015.

Ukraine has been weening itself off Russian energy imports and purchased almost no gas from its eastern neighbour in the period mentioned by Gazprom.

But the Russian firm said the amount it was after fell under the take-or-pay scheme that requires clients to reimburse Gazprom for any contracted gas they failed to purchase in a specific timeframe.

Russia's latest charge brings to nearly $32 billion the bill it claims is due by Kyiv.

Ukraine's Naftogaz state energy company is itself seeking nearly $26 billion from Gazprom in a Stockholm arbitration court.

- 50% transit rate hike -

Kyiv authorities have vowed repeatedly not to halt shipments to Europe despite its multiplying disputes with Gazprom.

Ukraine is reliant on EU backing in its struggle with pro-Moscow insurgents in its industrial east -- a 21-month conflict Russia denies either plotting or backing in retaliation for Kyiv's decision to anchor its future with the West.

But its cash-starved economy also needs proceeds from Russian gas shipments that Moscow intends to limit by expanding pipelines that already bypass Ukraine.

Kyiv this month raised the price it wants Gazprom to pay for its transits by 50 percent.

Ukrainian Energy Minister Volodymyr Demchyshyn said on Wednesday that Russia had simply ignored Kyiv's move.

"So now will meet in Stockholm," he said in reference to the arbitration court.

The Swedish tribunal had not yet examined the issue and it remains unclear when -- or if -- any ruling will be issued on the counter-suits.

Last Mod: 22 Ocak 2016, 14:53
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