Slovakia, Ukraine ink reverse gas flow deal

AFP , Monday 28 Apr 2014

Executive director of Ukrtransgas Ihor Lohman (L) looks on as Chairman of the Board of Directors of Eustream Tomas Marecek (R) reacts during a signing of a memorandum for reverse flow of natural gas from central Europe to Ukraine, at the Slovak government building in Bratislava, April 28, 2014 (Photo: Reuters)

Slovakia and Ukraine signed a deal Monday to give Kiev access to European gas supplies and reduce its dependence on Russia, according to the European Union.

"This is an important first step to diversify Ukraine's sources of gas supply and contributes to greater energy security in Eastern Europe and the EU as a whole," European Commission

President Jose Manuel Barroso told reporters after the three-way meeting in Slovak capital Bratislava.

The deal will allow European suppliers -- who have yet to be selected -- to use Slovakia's idle Vojany pipeline to pump gas to Ukraine.

Slovak Prime Minister Robert Fico said shipments to Ukraine would begin in around three or four months and would total around eight or nine billion cubic metres (bcm) of gas a year.

"If we add it to reverse gas deliveries Ukraine has already negotiated with Poland and Hungary, Kiev will be able to receive 16-17 bcm a year," he said.

As an EU member and neighbour to Ukraine, Slovakia is ideally located to provide Kiev with European gas at a time when Moscow is threatening to cut off supplies.

Ukraine currently consumes an annual 50 to 55 bcm of gas, half of which it imports from Russia, according to analyst figures.

Saying it still needs more gas to cover its consumption, Kiev vowed to continue negotiations with Slovakia about also pumping gas through its main pipeline.

But Slovakia and the EU said a contract with Russian energy giant Gazprom prevents Bratislava from offering the use of the larger pipeline.

"Signing today's deal is just a first step," Ukrainian Energy Minister Yuri Prodan told reporters in Bratislava.

"The document says Slovakia will make an effort with the help of the European Commission to initiate dialogue with Gazprom on the 'big reverse flow'."

Earlier this month, Gazprom raised the price of gas exports to Ukraine by more than a third, scrapping a discount amid soaring political tensions between the two countries.

Prodan said Ukraine was in talks with European gas suppliers on the reverse deliveries and was "ready to pay a fair price for them".

"Deliveries from EU member states offer Ukraine access to gas priced on the basis of fair and transparent principles," EU Energy Commissioner Guenther Oettinger said in Brussels earlier Monday.

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