22 Jan 2019 09:42

Russia's terms for deal on gas transit via Ukraine are competitiveness, resolution of legal claims - minister

BRUSSELS. Jan 22 (Interfax) - The basic condition for a new transit contract for transportation of Russian through Ukraine to Europe is that it be competitive compared to other routes, but the parties also need to resolve their legal dispute, Energy Minister Alexander Novak said after trilateral gas talks with Ukraine and the European Commission.

"The basic condition [for a new transit contract] is its commercial appeal, in other words the creation of such economic conditions that would be competitive compared to other routes, such as Nord Stream and TurkStream," Novak said in an interview with TV channel Rossiya 24.

"This is the first thing. The second: as is known, Gazprom and Naftogaz Ukraine are in litigation. Today this process has not concluded yet. An appeal court is supposed to consider Gazprom's appeal against Naftogaz soon. This is also an important condition in order to ensure the development and formulation of specific contract parameters as of January 1, 2020. [...] or there must be an arbitration ruling, or the parties must find a solution within the context of an amicable settlement," Novak said.

"This was discussed today within the context of our trilateral group. It seems to me that everyone was fairly constructive, and we agreed that we will hold the next meeting at the ministerial level in May, so that experts will have worked on the details of the future contract by that time," Novak said.

Gazprom CEO Alexei Miller told reporters: "We constructively discussed everything that concerns transportation of gas through Ukraine in general, and we're prepared to ensure such transit taking into account the growth of demand in Europe, taking into account that we are also building new gas pipelines and transportation of gas to European consumers will grow. Very many technical issues and parameters were touched on. Experts will continue corresponding consultations, and we'll return to trilateral consultations at a ministerial meeting in May."

A meeting of experts on January 15 did not take place due to "technical issues, because a very large package of documents was presented there, it had to be translated, a conclusion had to be made," Novak told reporters.

There is "no need to talk about [transit] volumes right now," he said. "This will be discussed by the companies when discussing the parameters. But in order to move to concrete discussion of contracts, first all legal proceedings that exist today between the companies must be resolved," Novak said.

"Secondly, rules, regulations must be presented on the part of Ukraine, which is changing its legislation. And, among other things, parameters [must be] presented on the tariff, which must be competitive compared to other gas pipelines, other infrastructure projects," Novak said.