Ukraine Signs Gas Transit Protocol on Russia’s Terms

Ukraine on Monday signed the trilateral gas transit protocol on terms demanded by Russia, supposedly paving the way for a renewal of Russian gas supplies to the EU.

Earlier, Russia had denied any responsibility for the shutoff, laying the blame on Ukraine.

Meanwhile, the pricing dispute between Ukraine and Russia remains unresolved.

Russia wants Ukraine to pay $450 per thousand cubic meters (mcm) of gas, which it considers the average European rate. Still, Russia pays only $1.6/mcm/100 km for transit, or less than half the average European rate, as comparison shopping suggests.

As of January 2009, the Czech Republic, which currently holds the EU’s rotating presidency, pays $450/mcm, based on a fluctuating rate, Jaroslav Basta, the Czech ambassador to Ukraine, said in an interview with Kommersant.

By contrast, neighboring Slovakia pays $270/mcm but charges upwards of $4/Mcm/100 km for transit, all rates being subject to confidential bilateral agreements.

Ukraine quoted the $270/mcm rate during closed-door gas talks with Russia, ambassador Basta said. “Obviously, the price of gas for Ukraine will have your independence factored into it,” the Czech ambassador added.

In 2008, Ukraine paid $179.5/mcm for Russian gas, charging $1.6/mcm/100 km for transit.

Ukraine transits approximately 80 percent of Russian gas exports to the EU, over a distance of about 1,240 km (770.5 mi).

Sources:
http://5.ua/newsline/236//56557/
http://www.kommersant.ua/doc.html?docId=1101621
http://www.pravda.com.ua/news/2009/1/12/87501.htm