Lined up: a meeting to discuss loans to support continuing gas flow to Ukraine
Ukraine needs $120m for June gas bill
Ukrainian President Viktor Yushchenko's energy envoy said state-run company Naftogaz will have to borrow up to $120 million to ensure full payment for June supplies of Russian gas.
Under a 10-year agreement signed in January that ended a two-week cutoff of supplies to Ukraine and Europe, Ukraine must make payment to Russia's Gazprom by the seventh day of the month following the imports.
Yushchenko has accused Prime Minister Yulia Tymoshenko, a former ally turned arch rival, of pursuing policies that will lead to Naftogaz's destruction by issuing credits through state banks to ensure payment of gas.
Energy envoy Bohdan Sokolovsky, addressing a news conference, said Naftogaz would have to pay about $300 million for June's import volume of 1.1 billion cubic metres of gas.
"Half the money will be generated from Naftogaz's activity and there will be some from company reserves of some sort. From $110 million to $120 million will have to be borrowed," Reuters quoted him as saying.
He said no decision had yet been taken on sources for borrowing. But Ukraine, he said, would meet its obligations "in terms of transit and payment for Russian gas in accordance with contracts for supplies and transit".
Sokolovsky's import figures were at variance with those provided by the government. Prime Minister Yulia Tymoshenko on Wednesday said 1.1 Bcm would be placed in storage without consideration of imports for domestic consumption, which is about about 1 Bcm per month, Reuters said.
Sokolovsky also said Ukraine intended to boost the volume of Russian imports in the third quarter when the price would fall to $199 per 1000 cubic metres to 200 per Mcm from second quarter levels of $271 per Mcm. He predicted a rise to $240 per Mcm in the first quarter of 2010.
Earlier Sokolovsky expressed doubt that Naftogaz would meet its June payment.
"The date of 7 July is approaching when payment must be made for gas received in June," he said on the presidential website. "The funds gathered by Naftogaz are not sufficient."
Tymoshenko said on Wednesday Ukraine had been putting Russian gas into storage according to plan in April and May and would make its June payment in full and on time.
"In June, we have again put into storage 1.1 Bcm," she said. "And we will again pay for it without fail."
Naftogaz's ability to make payment for Russian gas has been in focus in recent months, with Russian leaders suggesting the company is all but insolvent.
Tymoshenko said this month Ukraine needed $4 billion in credits to finance the purchase of gas to be placed in storage. No decision on providing any financing has yet been reached.
The European Commission, Gazprom and international banks will meet on Monday in Brussels to discuss a gas storage loan, a European Commission official said today.
"Everyone hopes that the problem will be fixed. We do not want another gas crisis," Marjeta Jager of Directorate-General for Energy & Transport, told reporters in Moscow.