Naftogaz to seek 12-month Russia gas deal next week

By Reuters

Apr 10, 2015 10:02 AM EDT

Ukraine's Naftogaz [NAFTO.UL] Chief Executive Andriy Kobolev will seek rapid progress on a deal to secure gas from Russia for the next 12 months in talks brokered by the European Commission in Berlin next week.

Last week, Ukraine signed an interim three-month deal for cheaper supplies of gas from Russia, providing breathing space for both sides in their protracted wrangle over pricing..

But Ukraine is still hoping three-way talks bringing together Russia, Ukraine and the European Commission can achieve a longer-term deal to cover next winter.

"We would prefer it to be signed as soon as possible. We have a more or less stable situation for the next three months," Kobolev told a news conference.

He said the date of the talks had been brought forward to Monday after a request from Moscow. The Commission said it still understood the talks would be on Tuesday.

Kobolev was speaking at NATO headquarters in Brussels, which he said he would visit periodically to update officials on what he referred to as a "hybrid war in energy".

Moscow and Kiev have been at odds since Russia's seizure of Ukraine's Crimea region last year and energy ties have been soured by a pricing dispute.

Russia's Gazprom last year cut off gas to Ukraine in a row over unpaid bills and only restored them late last year after the European Commission brokered a deal that expired on March 31.

The aim is to broker a solution to cover next winter and prevent Ukraine from having to revert to a gas contract with Russia that it says runs counter to market conditions.

Kobolev was also visiting the European Commission on Friday and said he would discuss the availability of funding from institutions as well as foreign banks. In all he estimatedUkraine needed around $1.5 billion to cover some 6 billion cubic meters of gas.

Ukraine is seeking to reform its economy and energy sector. On Thursday, it backed a law aimed at breaking the stranglehold of powerful groups over the lucrative gas distribution sector and establishing fairer market conditions.

Kobolev said he welcomed that deal, as did the European Commission.

In a statement on Friday, EU energy and climate chief Miguel Arias Canete said the European Union was ready "to support Ukraine in the swift implementation of transparency and reforms".

"Deep energy reforms and enhanced energy security are essential for the political and economic development of Ukraine," he said.

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