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October 22, 2019

Ukraine restarts gas import from Russia

Ukraine gas importUkrainian Naftogaz could make a request in March to get the first quantities of gas directly from Russia, revealed the director of the company Andriy Kobolyev. From 2015, Ukraine does not buy gas directly from Russia, but through reverse links from Poland, Hungary and Slovakia.

According to Naftogaz data in 2017, the gas imports to Ukraine increased by 27% to 14.1 billion cubic meters. The statistics show that 67 companies import gas in Ukraine in 2017. The rest of the consumption is covered by local production, which last year reached 20.5 billion cubic meters.

Ukrainian Naftogaz and Gazprom filed claims in an arbitration tribunal in 2014 with mutual claims for due amounts. In December 2017, the court ruled in a decision that partially satisfied both complaints. Both sides declared themselves winners of the case.

The court ruled that from 2018 until the end of the current contract (which expires in 2019), Naftogaz must buy 5 billion cubic meters of gas per year from Gazprom. The price for the Ukrainian company will be determined by the prices of European gas hubs. According to Gazprom’s estimates, the value of the supplies will reach 2 billion USD per year.

The “take or pay” clause remains for 80% of these 5 billion cubic meters. That is, even if Ukraine refuses to buy gas from the Russian giant, it will have to pay 80% of the subscribed quantities.

According to the contract signed by both companies in 2009, Ukraine had to buy 52 billion cubic meters of gas from Gazprom annually. Kiev, however, do not need such quantities, as the crisis in recent years has reduced consumption . In 2017, for example, it reached 31.9 billion cubic meters from 33.2 billion cubic meters an year earlier.

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