Trade Resources Economy Ukraine Plans to Slash Its Gas Imports From Russia to 18 Billion Cubic Meters in 2013

Ukraine Plans to Slash Its Gas Imports From Russia to 18 Billion Cubic Meters in 2013

RIA Novosti reported that Ukraine plans to slash its gas imports from Russia to 18 billion cubic meters in 2013 from 27.5 billion cubic meters this year.

Mr Yuriy Boyko energy minister of Ukraine said that "We have already informed our Russian colleagues of this volume 18 billion cubic meter. The two sides have been locked in a conflict over gas prices since they signed a supply deal in 2009 that ties the price of gas to oil prices which have risen steeply since 2009, boosting Ukraine's gas bill. Ukraine is seeking both to cut Russian gas imports and find alternative gas supply sources."

Mr Boyko said that Ukraine had not yet filed an official request for the purchase of 18 billion cu m next year. As soon as we formalize our official request, we'll get a response.

Mr Boyko previously described moves to slash Russian gas imports as breaching the terms of the contract, and that this would lead to a dispute with Russia but added that Kiev would safeguard its interests by all legal means.

Gazprom's long term contract with Naftogaz contains a take or pay provision that applies to 80% of the contracted volumes for a given year. That means Ukraine must pay for at least 41.6 billion cubic of gas this year even if it takes less.

Ukraine has said that due to high prices, it would slash gas imports from the contracted 52 billion cubic meters to just 27 billion cubic meters possibly as early as this year. Russia's position is that the contracted volume for this year is already fixed and that no alterations can take place within 6 months of the contracted delivery date. 

Source: http://www.steelguru.com/russian_news/Ukraine_warns_Russia_of_steep_gas_import_cuts_in_2013/293746.html
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Ukraine Warns Russia of Steep Gas Import Cuts in 2013
Topics: Metallurgy