Speaking out: Yulia Tymoshenko
Ukraine sitting on 3.1 Bcm gas stash
Ukraine has placed 3.1 billion cubic metres of gas into underground storage, Prime Minister Yulia Tymoshenko said today, as the cash-strapped former Soviet state was told that international financial institutions may be able to offer it stop-gap funding to help it pay for supplies.
Tymoshenko disclosed the figure to local officials a day after state energy company Naftogaz suggested that European gas companies should consider buying gas from Russia and storing it in Ukraine to avoid any recurrence of supply disruptions.
Separately, European Commission president Jose Manuel Barroso said International financial institutions are willing to help provide "stop-gap funding" to Ukraine to help it deal with problems paying for Russian gas imports.
However, Barroso said the European Union had no budget to help Ukraine with payment problems for Russian gas imports.
"That is not our responsibility, I should make that clear," Barroso told a news conference after an EU summit.
Barroso was briefing a summit of European leaders on Ukraine's financial problems and the threat that might lead to Russia cutting off gas supplies next month, including gas intended for transit to Europe.
Barroso said he spoke yesterday with international financial institutions including the International Monetary Fund and European gas companies to find a way through the impasse.
"(International financial institutions) and the European gas companies said they were willing... to help provide stop-gap funding," Barroso said, according to speaking notes seen by Reuters.
"There is the risk of another major gas crisis in weeks," he later told reporters.
Meanwhile, the European Union's Executive Commission yesterday called on Naftogaz, which faces severe financial difficulties, to seal an agreement with Russia to ensure uninterrupted gas flows, a Reuters report said.
Ukraine has long tried to store supplies of gas in preparation for winter, but Naftogaz's financial position had ruled out purchases in the first quarter of 2009.
Volumes of imports from Russian giant Gazprom have been well below levels set down in a New Year 10-year supply agreement Tymoshenko signed to end a three-week supply cut-off that affected hundreds of thousands of European customers.
Tymoshenko told the meeting of officials that Ukraine intended to boost imports in July, when the price of Russian gas is due to fall.
"This month, we are to pay $250 million and next month we will have to pay $1 billion," Reuters quoted her as saying.
Naftogaz says it expects gas prices to decline to $219 per 1000 cubic metres from $270 per Mcm in the second quarter and $360 per Mcm in the first quarter. Ukraine hopes the price will fall further to $162 per Mcm in the final quarter of the year.
Tymoshenko this week said she hoped to raise credits of about $4 billion to make necessary gas purchases.
Ukraine last year imported 49 Bcm of gas valued at $8.6 billion. Plans this year call for the purchase of about 33 Bcm.
Government plans for this specify 24.811 Bcm to be stored underground in 2009, including 2.5 Bcm in the first quarter, 5.079 Bcm in the second, 8.455 Bcm in the third and 8.777 Bcm in the final quarter.
At the end of last year, a record 30 Bcm was placed in underground storage, enabling Kiev to withstand the cut-off endured during the January dispute.