Ukraine Seeks to Devise Gas Consortium with Russia and EU

Ukrainian President Viktor Yanukovych has said that Ukraine is seeking to develop a gas consortium with Russia and the EU.

At a meeting yesterday in the Crimea with media from Georgia, the CIS and the Baltic States, the president said that consortium would be used to develop and modernise Ukraine's gas transport system (GTS) as a matter of energy security. The matter of the modernisation is important not just to Ukraine, he said, but to Russia and Europe.

While Ukraine saw the issue as a priority, it needs investment to undertake the operation, money it currently does not have, he said. "The main goal is to preserve the system, modernize it, invest in it and provide stable work," he told the reporters.

An evaluation of the cost of modernising the GTS is currently underway with an exact amount expected to be ready for August, the president announced yesterday. 

Today, President Yanukovych will meet with Russian President Vladimir Putin as well as other government officials and plans to bring up the matter of the creation of a gas consortium then. This will help to salve the energy relations between Ukraine and Russia, he believes, describing the issue as the "only acute" problem facing Ukrainian-Russian relations. 

"The creation of a gas transport consortium will definitely improve the relations between Ukraine and Russia in the gas sphere," he said yesterday. 

High gas prices from Russian major Gazprom have frequently been an issue for Ukraine which has struggled to pay for gas supply. The country supplies gas to its citizens below cost-price, a decision that has hit profits of state-run company Naftogaz Ukrainy. Despite instruction from the International Monetary Fund (IMF) to raise prices to citizens in order to receive European assistance, Ukraine has so far refused to do so.

However, President Yanukovych remained positive yesterday that an agreement could be reached with Russia to attain lower gas prices to Ukraine.

"We must find a solution," he said. "I think we will do it."