Ukraine warns of painful winter due to Russian gas cut

12th September 2014, Comments 0 comments

Ukraine warned on Friday that it will have to adopt deeply unpopular energy savings measures this winter should Russia fail to lift its suspension of natural gas sales to the West-leaning ex-Soviet neighbour.

Russia in June halted gas exports to Ukraine after Kiev balked at paying higher prices that Moscow demanded in the wake of the February ouster of a Kremlin-backed president.

Ukraine last year imported half of the gas it consumed from Russia. It is currently trying to make up for the difference by boosting imports from its western European allies.

Ukrainian Energy Minister Yuriy Prodan said the conflict-torn country will probably soon encounter severe energy shortages despite efforts to diversify its gas supply base.

"I think we can live through the fall and winter, although we will have to adopt some rather unpopular measures, including administrative ones aimed at reducing energy consumption," Prodan told an international forum in Kiev.

He accused Russia of "using gas as a political tool" and reported a shortage of gas in the country's underground storage tanks.

Poland said on Friday it had resumed its so-called "reverse flow" gas deliveries to Ukraine after a brief interruption it blamed on an unexplained cut in Russian supplies.

But its daily shipment of four million cubic metres accounts for just three percent of the gas Ukraine consumed last year.

Ukraine's energy problems have been compounded by five months of fighting between government forces and pro-Kremlin insurgents in Donbass -- an eastern region responsible for most of the country's coal production.

The chief executive of DTEK -- an energy holding owned by powerful tycoon Renat Akhmetov -- said Ukraine will have to import both coal and electricity from Russia this winter because of a work stoppage in the region's mines.

"We have no choice but to start importing electricity from Russia. We are dependent on Russia not only in gas supplies, but also coal and electricity," Maksym Tymchenko said.

The DTEK chief said Ukraine's power stations were operating well below capacity due to insufficient coal supplies.

He added that the truce signed between government forces and the rebels on September 5 would have to last at least a month before coal production in the eastern Donetsk and Lugansk regions could resume.

The European Union has proposed hosting a new round of gas price negotiations between Moscow and Kiev in Berlin on September 20.

But Russia has not yet formally accepted an invitation to attend the talks.

- 'Backroom deals' -

Moscow's VTB Capital investment bank said Ukraine will need to import almost 27 million cubic metres of gas daily until December -- more than five times the amount it receives from Poland -- to make sure it has enough supplies to last the cold winter months.

Most of Ukraine's imports from Europe come from Slovakia. But the former Soviet satellite has balked at shipping much larger quantities requested by Kiev out of fear of retaliatory measures from Russia and its energy giant Gazprom.

"I am afraid that Russia's temptation to use energy as a policy tool is not going to disappear, whether we like it or not," Slovak Foreign Minister Miroslav Lajcak warned.

He also lamented that EU nations had failed to take a unified stance against Russia -- responsible for shipping a third of the gas consumed in Europe -- and were signing individual discount deals with Gazprom that allowed it to maintain its energy dominance.

"We have to be honest: we still witness behaviour of energy nationalism (in Europe). We cannot... sign backroom deals with Russia," Lajcak told the Kiev forum.

© 2014 AFP

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