Ukraine Gas Transport via Hungary Starts in January
Ukraine’s plan to import natural gas from Germany through Hungary goes into action on January 1, next year, the Kyiv Post reports.
Energy and Coal Industry Minister, Yuri Boiko, made the announcement on television. "The current shipments of gas [purchased from Germany's RWE] go through the territory of Poland. Starting from January 1, the supplies will go through the territory of Hungary... We have done a great job, have held talks with the countries that have received permission from regulators and bought the capacities," he said.
Boiko added that the price of gas from the German utility was lower than that obtained from Russia's Gazprom. A statement from the Ukrainian national energy provider notes that Kiev paid Gazprom $1 billion (€0.78bn) for gas supplies in the month of October.
Relations between the two countries on gas supply have been fraught in the past.
"The price is constantly changing, because there we are tied to the price of spot gas... We hope that this summer the price will be lower by $100, since in summer the prices on the spot market are always lower," the minister said.
Buying 5 billion cubic meters of natural gas in the west will save Ukraine around $2 billion (€1.56 bn), Boiko estimated. All the gas bought under this scheme will be supplied to heating providers.
Moscow says it will cut prices only if Gazprom is allowed to buy into the pipelines that carry Russian gas across Ukraine to markets further west in Europe. Kiev has so far refused to agree.
Ukraine started shipping natural gas from Europe earlier this month. Its national oil and gas company, Naftogaz Ukrainy, and Germany's RWE signed a contract for the delivery of about 1 million cubic meters of natural gas per day during November-December of this year. Per a two-month contract the parties will be able to discuss a long-term agreement on the delivery to Ukraine of natural gas by reverse flow.
In other reports, a senior official of Naftogaz admitted that he expected opposition from Russia to Ukraine's attempts to source cheaper gas supplies. Ukraine takes around 15% of gas provided by state monopoly Gazprom.
Vadim Chuprun said his country wished to cut Russian imports by about one-third - from 27.5 billion cubic metres (bcm) next year to around 18 bcm.
"We know that Gazprom will oppose, but we do not need such a large volume of Russian gas at such high prices," he said.
Experts say that Ukraine could buy natural gas on European spot markets and import as much as 20 bcm through Slovakia, starting in 2015-2016.
See also earlier story: Ukraine Will Not Bargain With Russia for Gas