Kremlin surprised Poland won’t give Ukraine free coal
Published time: October 17, 2014 13:53
Now that Ukraine wants to receive Polish coal, and not Russian gas, free of charge, the Kremlin said it is surprised at Warsaw’s inconsistency towards Ukraine’s energy crisis.
“Our Polish partners have reacted in such a lively way to news of Ukraine wanting to get Polish coal almost free of charge,” Dmitry Peskov, the spokesman of Russian President Vladimir Putin, said. The Russian President was in Milan Friday with European and Asian leaders at the ASEM summit.
Peskov sees a major inconsistency in Warsaw’s attitude towards Ukraine in terms of which resources can be obtained for free and which cannot. The aide told Poland it shouldn’t be surprised that Ukraine wants to receive coal without paying, since Poland thinks that giving Ukraine Russian gas for free is fair.
On Thursday, Poland’s Deputy Prime Minister Janusz Pehochinsky expressed disappointment that Ukraine hasn’t yet paid for 100,000 tons of Polish coal.
Poland said it will provide Ukraine with coal as it faces an energy pinch in the lead up to winter. Poland has 10 million tons of unsold coal, which Warsaw blames on a flood of Russian imports.
Ukraine is one of world’s top coal consumers, and home to the 7th largest reserves. However, coal production in Ukraine has suffered as a result of war in the Donbass region, where 90 percent of the country’s coal mines are located. Most have closed down because of the fighting.
According to Peskov, Thursday’s report from Poland has shed light on the gas conflict between Russia and Ukraine.
“This is the best illustration of what’s going on in the gas sphere. The Poles were greatly impressed and did not conceal their shock. But still they can fully understand the desire to have gas free of charge.”
The “free gas” Peskov is talking about is the over 11.5 billion cubic meters of Russian gas Ukraine has imported, but not paid for.
In June, Gazprom switched off gas to Ukraine after Kiev refused to pay off its $5.3 billion debt or agree to price negotiations. In 2013 Ukraine used 50 billion cubic meters of gas to heat its homes and factories.
More gas discussions are to follow, as Russian Energy Minister Aleksandr Novak and the head of Gazprom Aleksey Miller are part of the Russian delegation currently in Italy for talks.
Putin says gas deal with Ukraine for winter months only, Poroshenko says no deal at all
Published time: October 17, 2014 13:19
Edited time: October 17, 2014 17:04
Edited time: October 17, 2014 17:04
Kiev and Moscow have failed to resolve their gas supplies dispute, Ukrainian President Petro Poroshenko said after meeting Russia’s leader. According to Putin, only an agreement for winter supplies has been reached, but details are still to be worked out.
“We agreed on the basic parameters of the gas contract,” Poroshenko told reporters in Milan where leaders from Europe and Asia gathered for the ASEM Summit. According to the Ukrainian president, the Ukrainian side is looking for sources of funding to pay off the arrears.
The optimistic statement came after Poroshenko met with Russian Energy Minister Aleksandr Novak and the head of Gazprom Aleksey Miller.
But emerging from a meeting Russia’s President Vladimir Putin later in the day, the Ukrainian leader said that no agreement had been reached. New talks have been scheduled for October 21; the EU is once again set to mediate the process.
“We have failed to reach any practical results,” Poroshenko told reporters after a 45-minute meeting with Putin. He noted that “some progress” in the dispute but said that details are yet to be worked out.
No more credit-based gas to Ukraine - Russia
Vladimir Putin, on his behalf, stated the two countries agreed on terms of gas supplies “at least for the winter period”.
"The current issue is cash deficit in Ukraine," Putin said, calling on Western partners to help Kiev overcome the crisis.
Russia is not ready to supply gas to its eastern neighbor without pre-payment. He said that Kiev still owes Moscow some $5.5 billion, but is ready to reconsider this sum and a provide a discount of $100 per one thousand cubic meters. This will reduce the debt to $4.5 billion.
At the last round of gas talks held in Berlin along with EU energy commissioner Gunther Oettinger, it was agreed that Ukraine would start paying back Gazprom $2billion of its $5.3 million debt, and Russia would turn back on supplies.
So far no further detail has been provided, but trilateral talks between Russia, the EU, and Ukraine will again be held on October 21 in Brussels.
The gas price and payment schedule have been key stumbling blocks in the dispute.
Russia offered $385 per 1,000 cubic meters of gas, less than the $400 average for European clients, but Kiev argues the price is too high, and wants to set it at $285 per 1,000 cubic meters.
Europe counts on Russian natural gas to meet about one third of its energy needs, and 50 percent of the gas travels through Ukraine. If Moscow cuts off deliveries via Ukraine, 15 percent of Europe’s gas will be at risk.
Moscow will supply enough gas to Europe this winter, but says Ukraine remains a wildcard. If Kiev siphons off gas intended for European customers, Moscow will be forced to reduce gas supplies.
Russia turned off the gas to Europe via Ukraine in 2006 and in 2009, over similar pricing disputes with Kiev. A prolonged supply disruption would have a substantial impact on the EU, the European Commission warned on Thursday.
Latvia, Lithuania, Estonia, Finland, Bulgaria and the Czech Republic import 100 percent of their natural gas from Russia and would be affected most by a cut in supply, as they would be without at least 60 percent of the gas they need keep the heat on.
“This means that even private households could be left out in the cold. If countries work together, instead of adopting purely national measures, then fewer consumers will be cut off from the gas,” the EU statement said.
Ukraine has already been preparing for shortages in central heating, with some stocking up on dirtier energy sources like wood and coal, just in case they have to survive the winter without gas.
Topic: Russia-Ukraine Gas Conflict