EU in trouble unless Ukraine sharply boosts gas reserves

AFP , Monday 16 Jun 2014

Moscow
Russia's Energy Minister Alexander Novak, right, listens as Russian state-run natural giant Gazprom CEO Alexei Miller speaks at a news conference in Moscow, Russia, Monday, June 16, 2014 (Photo: AP)

Ukraine needs to boost its gas reserves by about a third before the end of the summer to ensure gas to Europe flows safely, the European Commission said Monday.

Concerns are mounting that European Union nations could face gas shortages this winter after Russia cut supplies to Ukraine in a dispute over gas prices.

Pipelines running through Ukraine transport 15 percent of the fuel consumed in Europe.

In order to get through the winter, Ukraine must increase its reserves from a current 13.5 billion cubic metres to 18 to 20 billion cubic metres, said a spokeswoman for Energy Commissioner Gunther Oettinger.

"The storage must be filled by the end of summer," Sabine Berger added.

Of the 50 billion cubic metres of gas consumed in Ukraine in 2013, 30 billion were bought from state-owned Russian giant Gazprom, which Monday announced it was cutting supplies to Kiev following the collapse of weekend talks.

Gazprom now requires Ukraine pay in advance for gas.

The EU buys 39 percent of its gas from Russia, almost half of it piped across Ukraine to Poland, Slovakia, Hungary and Romania, then on to Austria, the Czech Republic, Slovenia, Italy and Bulgaria.

Ukraine uses stockpiles to ensure gas continues to flow to Gazprom customers in the EU even if there are problems with supplies from Russia.

But Ukraine could, as it has during two previous disputes in the past decade, also tap these reserves and use the gas for its own needs, potentially threatening supplies to the EU.

The EU's gas coordination group is to meet Friday to review the situation in the light of the Ukraine-Russia gas dispute.

With imports of 25.3 billion cubic metres, Italy was Gazprom's second biggest customer after Germany, which is not supplied via Ukraine.

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