BRUSSELS: Ukraine’s energy minister, EU officials and industry representatives held talks yesterday on cutting reliance on Russian gas as tension with Moscow drove home the urgency of finding alternative energy sources and supply routes.
Concerns reached a new pitch after pro-Moscow protesters seized buildings in eastern Ukraine’s mainly Russian-speaking industrial heartland, which Kiev said is a replay of events in Crimea, the peninsula Moscow annexed last month. At the same time, Kiev missed a midnight deadline to reduce its $2.2bn debt owed to Russia for natural gas supplies.
That adds to concerns Russia could cut off Ukraine’s gas supplies, with possible knock-on effects for the European Union.
Ukraine’s Energy Minister Yuri Prodan was quoted by Interfax news agency as saying Russia’s decision to nearly double gas prices to Ukraine was unjustified and Kiev would not pay.
“If the situation is not resolved, there will be a threat not only for the supply of gas to Ukraine, but also for the transit of gas to Europe,” Prodan said.
Moscow also has a great deal at stake. Its gas exports to the European Union provide state-controlled exporter Gazprom with an average of $5bn per month in revenue.
An invitation to gas industry officials to yesterday’s talks said Europe’s gas storage levels were comfortable after a mild winter, but it was already time to prepare for the next heating season.
One source close to the talks, speaking on condition of anonymity, said the Commission had asked member states to report back with full details of infrastructure and storage, saying efforts must be made to fill storage well ahead of next winter.
Following previous crises in 2006 and 2009 over Kiev’s unpaid gas bills, which led to the disruption of exports to western Europe, the European Union has taken steps to bolster its energy security, including increased gas storage. Analysts say nowhere near enough has been done, but EU officials say there is renewed determination to act, alongside a recognition that changing Europe’s energy system will take time. Russia provides Ukraine with around half of its gas and the European Union with roughly one third of its demand, some 40 percent of which flows via Ukraine.
Denmark put forward the idea, adopted by an EU summit in March, that the Commission should draw up by June a detailed plan on increasing energy security and says this time around the mood is completely different. Reuters
