Ukraine Today Press Review: Russia #39;s Ukraine position
Ukraine Today correspondent Rahim Rahemtulla takes a look at two articles which suggest that Russia may be trying to bring an end to the conflict in east Ukraine. Check out our website: http://uat...
By: UKRAINE TODAY
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Ukraine Today Press Review: Russia's Ukraine position - Video
Ukraines Naftogaz has sent $378.22 million to Russia as advance payment for natural gas supplies, which should lead to the resumption of shipments that were suspended nearly six months ago in a dispute over the prices Moscow had set for the fuel and debts Kiev owed for previous shipments.
Russias Gazprom said Dec. 7that it had received the payment, which had been made the day before. Under an agreement signed between the two government-owned gas companies, the flow of gas was to resume within 48 hours after payment.
The payments and the flow of gas come just in time, as wintry weather settles on Ukraine. It also is good news for Russias gas customers in the European Union, Alexander Paraschiy, an energy analyst at Concorde Capital in Kiev,told Bloomberg News. Russian gas paid for [now] cuts the risk of shortages in Ukraine and in Europe-bound transit at least until the middle of February, he said.(Related:South Stream Pipeline May Not Be Dead Yet)
Vladimir Demchishin, Ukraines minister of energy and coal industry, said Dec. 5 that the payment would buyabout 1 billion cubic meters of gas. His predecessor, Yuri Prodan, said earlier in December that the amount would depend on weather and demand. Under the Gazprom-Naftogaz contract, Ukraine can decide at any time on the amount of gas it needs for a given period, as long as it pays in advance.
But thats just the first installment.Paraschiy saidthat, for now, the country cant rely much on coal because of the pro-Russian violence in Ukraines eastern coal region, and estimated that Ukraine may need as much as 4 billion more cubic meters of Russian gas, costing up to $1.5 billion, starting in January to keep warm through the winter.
Having gone six months without Russian gas, Ukraine has beenstrictly limiting its consumption of gasfrom its reserves and increasing its imports from EU countries. Still, Russia could suspend deliveries again if Ukraines doesn't maintain payments on its $5 billion debt for past gas deliveries by Jan. 1, according to Russian Energy Minister Alexander Novak.
In October, under EU mediation,Kiev accepted an offer by Moscowto supply gas to Ukraine until March 2015. Ukraine also must pay Russia $3.1 billion of its outstanding debt of more than $4 billion by the end of 2014. The first installment of that debt repayment was made in November.(Related:Ukraines Next Energy Minister Will Be Bought and Paid For, As Usual)
If Ukraine continues to stay current on its payments, Europe can rest easy, at least for the coming winter. EU customers get about one-third of their gas supplies from Russia, and half of that flows through pipelines in Ukraine. Thats a key reason that the EU mediated the payment deal.
Russiacut gas deliveries to Ukraineon June 16 against the backdrop of the popular overthrow of pro-Russian Ukrainian President Viktor Yanukovich in February, Russias annexation of Ukraines Crimean peninsula in March, and the growing fighting between Ukrainian forces and pro-Russian separatists in eastern Ukraine.
Disputes between the two countries had previously led Russia to suspended gas deliveries in 2006 and 2009. In both of those cases, Russian gas deliveries to the EU were affected.
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Ukraine makes payment for Russian gas as winter arrives
Ukraine began importing Russian gas for the first time in almost six months, reducing the temptation to siphon off fuel piped across the country to the rest of Europe during freezing winter months.
Ukraine will receive as much as 43.5 million cubic meters of natural gas a day for the coming month from OAO Gazprom, the Russian state exporter, Maxim Bilyavskiy, a spokesman for pipeline operator UkrTransGaz, said by phone. Thats equal to about a fifth of the current demand in Ukraine, which has relied on supplies from Europe through so-called reverse flows.
Russia halted gas to Ukraine on June 16 over a price and debt dispute as relations soured over its annexation of Crimea and involvement in unrest in its neighbors easternmost regions. The European Union, relying on gas piped through Ukraine for 15 percent of its needs, brokered an interim deal in October to help avoid shortages seen in 2006 and 2009 during the winter.
The interim deal covers Gazprom deliveries through March, with a set price discount and debt-restructuring conditions. Ukraine also agreed to pay for Russian gas up front, handing over $378 million for 1 billion cubic meters last week.
Russia warned Europe in a meeting of energy chiefs on Aug. 29 that the region risked having gas supplies siphoned off in the winter if the payment dispute between the former Soviet allies wasnt resolved, an accusation that Ukraine rejected.
Risks to gas flows through Ukraine are very high, Gazprom Chief Executive Officer Alexey Miller said today on state television after deliveries resumed.
Supplies may be halted again Jan. 1 if Ukraine doesnt pay $1.65 billion of debt by the end of the month under the EU-brokered deal, Russian Energy Minister Alexander Novak said in October.
Ukraine hopes all parties will do everything possible to uphold the agreement, Andriy Kobolyev, CEO of state energy company NAK Naftogaz Ukrainy, said at a summit in London today. Ukraine has been fulfilling all its obligations under the deal. And we must also admit that Gazprom has done the same so far.
Ukraine will probably offtake as much as 5 billion cubic meters of Russian gas until the end of the winter season, Kobolyev said. Thats as much as $1.5 billion revenue for Gazprom aside of fuel already paid for given the price, expected by Ukraine in the first quarter.
Gazprom rose 0.9 percent to 136.28 rubles by 5:22 p.m. in Moscow after three days of decline.
Read more:
Ukraine Resumes Russia Gas Imports, Curbing EU Supply Risk
YASYNUVATA, UkraineThe bang of nearby artillery fire echoed off the facade as Vladimir Trubchanin inspected his charred, Stalin-era office building.
The war went right through the building. Those were the windows of my office, the 45-year-old factory director said, pointing to some blackened holes.
It has been a bad year for his Yasynuvata Machine-Building Plant, which produces giant digging equipment used in coal mines. In September, the factory found itself on the front line in Ukraines conflict with Russia-backed separatists.
The front has moved down the road, but the factory is still reeling. Production has all but halted. Three quarters of the staff of about 800 are gone. The plant has ended up in a rebel pseudo-state. Nearly all the documents went up in flames in the main office, as artillery shells blasted out the factory floors windows and parts of the walls and roofs.
The sweeping collapse of industry in Ukraines eastern Donetsk and Luhansk regions has reverberated across the country, posing serious problems for the government and the rebels alike.
Should businesses like Mr. Trubchanins fail, the separatist-held regionwith a pre-conflict population of about 4.5 millionwill face an even dimmer future.
Alexander Khodakovsky, leader of the separatist Vostok battalion, warned that export-focused factories in the Donetsk region could end up as scrap metal if they were to lose their ties to the Ukrainian market.
Remember the old saying, Demand creates supply, Mr. Khodakovsky told a group at the local university on Nov. 24. If we provoke the destruction of market channels at this time with some sort of careless actions, well lose everything.
The rest of Ukraine stands to lose, too. Before the conflict, the two regions accounted for about 16% of Ukraines gross domestic product and roughly a quarter of industrial output, as well as almost all the countrys coal production. Much of that is now cut off.
Industrial production in Ukraine for the month of October shrank by 16.3% from a year earlier. The decline, combined with dwindling foreign-exchange reserves, has sent Ukraines currency plunging farther than any other in the world this year.
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Collapse of Industrial Heartland Reverberates Across Ukraine
Made in Ukraine "Liar Liar" (If Kiselev Spoke the Truth) PART 1 English Subtitles
Kiselev is Putin #39;s Goebbels.
By: Alita Torjusen
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Made in Ukraine "Liar Liar" (If Kiselev Spoke the Truth) PART 1 English Subtitles - Video