Russia/Ukraine/EU

EU says gas supply must be restarted as arguments about observers continue

Article published on the 2009-01-09 Latest update 2009-01-09 13:52 TU

Russian Prime Minister Vladimir Putin and former German Chancellor Gerhard Schroeder.
(Photo: Reuters)

Ukraine's gas company says it is ready to accept Russian observers of the pipeline between the two countries, although Russia's Gazprom claims that the Ukrainians have refused to co-operate. Meanwhile Gazprom is pushing to secure the creation of a new pipeline which would bypass transit routes and supply gas to Germany directly.

Ukraine’s national gas company Naftogaz said on Friday that it is not against the presence of observers from Russian gas company Gazprom in the country, an issue which was slowing down the resolution of the ongoing gas dispute.

“The main thing is that they should be legitimate and have a mandate from either the president or prime minister of Russia,” Valentyn Zemlyansky, a spokesperson from Naftogaz told the AFP news agency.

But a statement released by Gazprom on Friday contradicted those comments.

“The Ukrainian side has rejected the creation of a multilateral committee of observers,” said the statement.

Russia agreed to the presence of EU monitors who could observe gas transit through the country, and the first team of observers arrived in Kiev on Friday.

Issues over observation had slowed down negotiations and led to the disintegration of emergency talks on Thursday.

Since this apparent agreement had been reached, the EU demanded that Russia restart gas supplies through Ukraine.

The dispute began at the start of the year after arguments about payment for Ukraine’s gas supply. Moscow had accused the country of siphoning off gas destined for Europe which is piped through the country.

The Nord Stream pipeline.
(Photo: Wikipedia)

In other developments, a new pipeline which would cut out transit through Ukraine is under discussion.

Former German Chancellor Gerhard Schroeder appeared on television with Prime Minister Vladimir Putin on Wednesday.

They announced a new project called Nord Stream which would pipe gas directly to Germany under the Baltic Sea.

Schroeder, who earns one million euros a year as a director of Gazprom, believes the project, which includes 1,200 kilometres of pipeline could be up and running by October 2011.

“Nord Stream is an extremely important project … to strengthen the energy security not only of Germany but all of Europe,” said Schroeder.

The project and the current gas dispute are intrinsically linked and the beginning of the gas crisis at the start of this year coincided with a key deadline for approval of Nord Stream and the eight billion euros of offshore pipeline.

Environmental concerns, security fears and objections from countries who would no longer receive transit fees have delayed the issue of important permits.

Gazprom, German energy companies BASF and E.ON, and Dutch firm Gasunie all hold major shares in the Nord Stream project.

Meanwhile, in Georgia the supply of Russian gas to Armenia has been suspended for five days after damage to a pipeline. Gazprom have said they can assist in repairing the damage, which affects a country entirely dependent on Russian gas.