Main page > Comments > Actual topics > Ukrainian GTS, no agreements so far

Ukrainian GTS, no agreements so far

Two weeks before the New Year more rumors are coming from Kiev about an alleged compromise on the natural gas issue that Ukrainian negotiators have managed to achieve. According to materials published in the Ukrainian press, the country will provide Gazprom a possibility to enter two joint ventures that will deliver natural gas to Ukraine and transit it to Europe in exchange for halving the price of Russian gas for Ukraine.

The problem is that at first it is planned to allocate 50% in the JV to Gazprom but then about 33% like Ukraine and European companies to be possibly invited to join will have. But Gazprom and Russian political authorities want something different – at least 51% in the JV (consortium) while the other part of the shares can be divided between Naftogaz (or its successor), German, Italian and French firms. A similar scheme is employed in the South Stream project that the Russian side considers a role model.

However, ceding 51% in the pipeline system is the move Ukrainian elites view as absolutely impossible. All speculations about handing over control over the pipeline system finish with claims that “the Sun is more likely to fall on the Earth than the GTS is to be ceded”. But in this case rumors about gas concessions will remain just rumors. In this context Alexey Miller’s words that “[Kiev] will not get New Year gifts” are understandable.

By Stanislav Mitrakhovich, NESF leading expert


Bookmark and Share

Analytical series “The Fuel and Energy Complex of Russia”:

Gazprom on the background of external and internal challenges
Regulation of Oil and Gas Sector in 2019 and Prospects for 2020
Fiscal Policy on Oil and Gas Sector: Revised as Often as Wikipedia
The tax system in the oil and gas sector continues to undergo radical changes. The beginning of 2019 saw the introduction of a new tax regime: additional income tax. That experiment was supposed to start migration of the oil industry to an innovative principle of taxation: on profit, not revenue. It seemed that a new main road was found. In the same year, however, the Finance Ministry launched an overt offensive against AIT. The fear of loss of government revenue now is more powerful than the threat of causing oil production to collapse in the medium term because of a tax system that does not stimulate investment. The Finance Ministry would strongly prefer to speed up the tax manoeuvre completion that earns the state budget additional money. Oil and gas companies respond to this with individual lobbying, attempting to wangle special treatment for their projects.
Ukrainian Gas Hub: Climax at Hand
The “zero hour” comes in less than a month: the contracts for gas transit through Ukraine and for supplying Russian gas to the country terminate at 10 am on 1 January. Meanwhile, Gazprom and Naftogaz are very far from looking for a mutually acceptable solution. The entire European gas business is watching intently the negotiations between Russia and Ukraine. Everyone is waiting for a new “gas war”: the January 2009 events proved to be a serious test both to European consumers and to Gazprom as a supplier. Is there still a chance of agreement? If there is not, will Gazprom cope with its obligations to deliver gas to Europe? Is Russia bluffing as it assures that the new infrastructure and gas in underground storage facilities will enable it to get by without Ukrainian transit even as soon as this winter? What will happen to Ukraine itself at the beginning of 2020?
Digitisation and Its Implications for Oil and Gas: Myths and Possible Reality

All reports for: 2015 , 14 , 13 , 12 , 11 , 10 , 09 , 08 , 07

Rambler's Top100
About us | Products | Comments | Services | Books | Conferences | Our clients | Price list | Site map | Contacts
Consulting services, political risks assessment on the Fuel & Energy Industry, concern of pilitical and economic Elite within the Oil-and-Gas sector.
National Energy Security Fund © 2007

LiveInternet