Russia to Seek Exemption From $6.4Bln Fine for Gazprom at Trilateral Gas Talks

According to Russia's Kommersant newspaper, Moscow was ready to sing an additional agreement to its gas contract with Kiev, envisaging abandonment of a take-or-pay policy, in exchange for reciprocal concessions.

MOSCOW (Sputnik) — These concessions include, in particular, canceling of Gazprom's fine for the abuse of a monopoly position in the market of gas transit via pipelines at the Ukrainian territory.

It is also noted that Gazprom is not ready to grant Ukraine a discount since the price of Russian gas is significantly lower than EU price, reaching about $182 compared to $244 per 1,000 cubic meters, including delivery to the Ukrainian border.

Ukraine is a key country for transit of Russian gas to Europe. However, for years Russia and Ukraine have been engaged in gas disputes. In June 2014, Gazprom switched Ukraine to a prepayment system for gas supplies citing its massive gas debt. Ukraine’s Naftogaz appealed to the Arbitration Court in Stockholm, seeking a retroactive revision of its 2009-2019 natural gas transit contract with Russia.

In October 2015, Naftogaz said it would not buy gas from Gazprom due to high prices. Ukraine said it had other suppliers in Europe and would only resume purchases if Russian prices were below EU prices, while Russia said it halted deliveries when Ukraine failed to pay.

Europe intervened in the dispute late in 2015 to mediate the so-called winter gas package for the peak season in 2015-2016 at trilateral talks. A 2016-2017 winter package has not been agreed on despite the onset of the cold season.