Vice PM Says Ukraine Imports Most Expensive Gas in Europe

In 2011 alone Ukraine overpaid 6 billion dollars for natural gas, Ukraine’s Vice Prime Minister Serhiy Tihipko said in his interview with the British newspaper The Telegraph.

“We have the most expensive gas in Europe… and we are not the richest country in Europe,” said Tihipko.

In Q2 2012 Ukraine paid an average of USD 425 dollars per thousand cubic meters of imported Russian gas. This price already includes the USD 100 discount Ukraine and Russia negotiated in 2010. With the existing price, the country has to pay almost 27 percent of its estimated budget revenues in 2012 for Russian gas. Comparably, Italy is charged USD 410, while Germany and Slovakia pay USD 379 and USD 333 respectively, according to FT.

Ukraine pays today’s gas price in accordance with a 2009 contract negotiated by Ukraine’s former Prime Minister Yulia Tymoshenko. The current Ukrainian government says the agreement was “reckless” and left the country with an enormous price for gas supplies, reads The Telegraph.

Consequently, for brokering the gas deal with Russia Tymoshenko was convicted of abuse of office. On August 29, 2012 Ukrainian Specialized High Court upheld the verdict in Tymoshenko’s case. Serhiy Tihipko told the British media that while he understood that the case complicated Ukraine’s integration with the European Union, “there should be no doubt over Tymoshenko’s guilt”: “It is clear to us there is a clear violation… This was a criminal case, not a political case.”

The Vice Prime Minister explained that under Ukrainian law the cabinet of ministers approves all intergovernmental agreements of the sort, but in case of the 2009 gas contact with Russia – the cabinet did not approve it. The former Ukrainian President Viktor Yushchenko, who was in the office at the time of the deal, has stated that there had been grounds for the suit against Tymoshenko, reads the newspaper. Tihipko, however, acknowledged that Kyiv, as a signatory to the European Convention on Human Rights, would honor any decision by the court.

Meanwhile Ukraine steps up its efforts to gain energy independence: the country decreased the amount of imported natural gas by 48.77 percent down to 12.8 billion cubic meters in January – May 2012, compared to the respective period of 2011.

[mappress]
LNG World News Staff, September 04, 2012