FT Interview with
Hryhoriy Nemyria
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YULIA TYMOSHENKO
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Ukraine Pays Gas Bill and Plans Cuts in 2010
12 October 2009
Published in
Inform
issue #127
See the full issue here.
Ukraine has again paid its monthly gas bill to Gazprom in full and on time. However, shortly after the $400 million September bill was paid, Prime Minister Yulia Tymoshenko reaffirmed plans to cut natural gas imports in 2010.
At a government meeting the premier admitted that payment of the bill for 2 billion cubic metres of gas consumed in September was “not easy” and that Naftohaz “worked for a month to scrape together every single penny, every single hryvnia” to make the payment. Despite this, the government and Naftohaz officials are confident that Ukraine will meet its future commitments.
During the spring and summer months Naftohaz put sufficient volumes of gas into storage to avoid any re-run of last January’s gas crisis, which caused disruption of supply to some European states. To-date the state-run company has pumped some 26 billion cubic metres of gas into its network of vast underground storage facilities. This is adequate to cover the winter period and ensure the smooth flow of gas to Europe. Currently, some 80 percent of Russia’s gas exports to the EU transit through Ukraine.
See the full issue here.
Ukraine has again paid its monthly gas bill to Gazprom in full and on time. However, shortly after the $400 million September bill was paid, Prime Minister Yulia Tymoshenko reaffirmed plans to cut natural gas imports in 2010.
At a government meeting the premier admitted that payment of the bill for 2 billion cubic metres of gas consumed in September was “not easy” and that Naftohaz “worked for a month to scrape together every single penny, every single hryvnia” to make the payment. Despite this, the government and Naftohaz officials are confident that Ukraine will meet its future commitments.
During the spring and summer months Naftohaz put sufficient volumes of gas into storage to avoid any re-run of last January’s gas crisis, which caused disruption of supply to some European states. To-date the state-run company has pumped some 26 billion cubic metres of gas into its network of vast underground storage facilities. This is adequate to cover the winter period and ensure the smooth flow of gas to Europe. Currently, some 80 percent of Russia’s gas exports to the EU transit through Ukraine.
Reduced imports in
2010
Looking to next year, the premier said that the country seeks to import only the volumes of gas it needed to consume. “Next year, we'll buy the volume of gas that Ukraine needs. This will be less than in 2009, as we are cutting consumption of natural gas, replacing it with other sources – electricity, coal, peat," said Ms Tymoshenko.
Speaking at the world natural gas congress in Buenos Aires, Argentina, Gazprom’s CEO Alexei Miller said that Gazprom would not cut natural gas supplies to Ukraine in 2010 and that there will be no revision of the terms of the original contract.
Following last January’s damaging gas crisis, relations between Ukraine and Russia have improved. When Prime Minister Tymoshenko met with her Russian counterpart, Vladimir Putin, in Sopot, Poland last month, the two leaders agreed that Ukraine would only pay for natural gas that it consumed in 2009. The Russian leader said at the time “that the current global financial crisis… must be taken into account in our bills and supplies… We understand that the Ukrainian economy uses only that which it needs today."
It is expected that in 2010 Ukraine will import 27-33 billion cubic metres of natural gas from Russia, which is less than the minimum 42 billion cubic meters it contracted to import. Indeed, Naftohaz has already submitted a proposal to Gazprom to reduce its gas imports in 2010 to 33 billion cubic metres.
Demand for gas in Ukraine has dropped due to the global economic crisis, increased energy efficiency, the stepping up of domestic gas production and greater use of alternative energies.
According to Vadym Chuprun the deputy head of Naftohaz, falling demand for gas across Europe means that extra gas pipeline capacity planned for Europe, in the form of multi-billion dollar plans for new infrastructure projects, is not actually needed. In an interview in Petroleum Economist he said that Ukraine’s pipeline system has 80 billion cubic metres of spare capacity. This surpasses the combined capacities of the proposed Nord Stream and the Nabucco pipeline projects, which would bypass Ukraine.
Looking to next year, the premier said that the country seeks to import only the volumes of gas it needed to consume. “Next year, we'll buy the volume of gas that Ukraine needs. This will be less than in 2009, as we are cutting consumption of natural gas, replacing it with other sources – electricity, coal, peat," said Ms Tymoshenko.
Speaking at the world natural gas congress in Buenos Aires, Argentina, Gazprom’s CEO Alexei Miller said that Gazprom would not cut natural gas supplies to Ukraine in 2010 and that there will be no revision of the terms of the original contract.
Following last January’s damaging gas crisis, relations between Ukraine and Russia have improved. When Prime Minister Tymoshenko met with her Russian counterpart, Vladimir Putin, in Sopot, Poland last month, the two leaders agreed that Ukraine would only pay for natural gas that it consumed in 2009. The Russian leader said at the time “that the current global financial crisis… must be taken into account in our bills and supplies… We understand that the Ukrainian economy uses only that which it needs today."
It is expected that in 2010 Ukraine will import 27-33 billion cubic metres of natural gas from Russia, which is less than the minimum 42 billion cubic meters it contracted to import. Indeed, Naftohaz has already submitted a proposal to Gazprom to reduce its gas imports in 2010 to 33 billion cubic metres.
Demand for gas in Ukraine has dropped due to the global economic crisis, increased energy efficiency, the stepping up of domestic gas production and greater use of alternative energies.
According to Vadym Chuprun the deputy head of Naftohaz, falling demand for gas across Europe means that extra gas pipeline capacity planned for Europe, in the form of multi-billion dollar plans for new infrastructure projects, is not actually needed. In an interview in Petroleum Economist he said that Ukraine’s pipeline system has 80 billion cubic metres of spare capacity. This surpasses the combined capacities of the proposed Nord Stream and the Nabucco pipeline projects, which would bypass Ukraine.