Azarov: Modernisation of Ukrainian GTS to Cost €4.5 Billion

Ukrainian Prime Minister Mykola Azarov has said that modernisation of Ukraine's gas transport system (GTS) will cost around €4.5 billion and will require the cooperation of Russia and the EU.

Speaking to German newspaper Frankfurter Allgemeine Zeitung at the weekend, Prime Minister Azarov said that cooperation between the three parties could lessen conflict between Ukraine and Russia while providing a much-needed improvement to the GTS.

"The so-called gas conflicts of Ukraine and Russia in recent years have demonstrated the need for the joint coordination of actions on energy security," the Kyiv Post reports him as saying. "I mean the combination of the interests of Russia as a supplier, Ukraine as a transit country, and the EU as a major customer. It's clear that the Ukrainian gas transport system is in need of major modernisation."

The Prime Minister also once again pointed to the difficulties of the Nord Stream and South Stream pipelines in ensuring security of supply during the colder months of the year, stressing that Ukraine could ensure this security of supply through its underground storage system as well as through a modernised GTS.

"The recent extreme cold has demonstrated that neither Nord Stream nor South Stream has or can have reliable gas storage facilities, the reserves of which could be used in periods of low temperatures," he said. "Ukraine has such storage facilities."

Prime Minister Azarov has previously said that there can be no alternative to modernising Ukraine's gas system, especially in light of a particularly cold snap, which cut supply throughout Europe in February of this year.