Ukrainian gas company Naftogaz and Russian gas company Gazprom are considering an EU proposal where Naftogaz pays Gazprom $2 billion by Friday in exchange for talks on a new gas price and no prepayment in June, the European Commission said late Monday.
The proposed deal, which is subject to confirmation by both the Russian and Ukrainian authorities by Wednesday, also involves Naftogaz paying another $500 million to Gazprom by June 7.
These are "partial payments of the outstanding bills covering the period from November 2013 till March 2014 as well as the months of April and May 2014," the EC said.
The proposed deal involves Gazprom, on receipt of the first payment, opening talks on the new gas price as of April and continuing to supply gas in June "without insisting on prepayment," the EC said.
The deal emerged after EU energy commissioner Gunther Oettinger, Russian energy minister Aleksandr Novak and Ukrainian energy minister Yuriy Prodan met in Berlin Monday to discuss gas security, prices and Ukraine's gas debt to Russia for the second time. They met first in Warsaw on May 2.
Naftogaz had said before the meeting that it was ready to pay for gas if Gazprom agrees to cancel its 80% price hike that saw the price rise in April to $485/1,000 cubic meters from $268.5/1,000 cu m.
Russia had said it would agree to begin talks on lowering Ukraine's gas prices once Naftogaz pays its gas debt, which Gazprom has estimated at $3.5 billion.
The EC said a third round of three-way political talks on the next steps could take place on Friday if the proposed deal is confirmed.
