Amid 'gas war' talk, Russia reassures Europe on supply
KIEV/MOSCOW (Reuters) - Russian President Vladimir Putin tried to ease European fears of gas supply cuts on Friday after Brussels said it would stand with the new authorities in Kiev if the Kremlin carries out a threat to turn off the tap to Ukraine.
Russia, which last month angered Western powers by annexing Ukraine's Crimea peninsula, has raised the price it charges Kiev for gas and said it owes Moscow $2.2 billion in unpaid bills.
That has raised the spectre of previous "gas wars", when rows between the two former Soviet states led to problems with onward supplies to western Europe. A repeat of that scenario could hurt Russia as well as EU customers for its gas because Moscow depends for its public revenues on selling gas in Europe.
"I want to say again: We do not intend and do not plan to shut off the gas for Ukraine," Putin said in televised comments at a meeting of his advisory Security Council. "We guarantee fulfilment of all our obligations to our European consumers."
The stand-off, precipitated by the overthrow of the Moscow-backed Ukrainian president after he rejected closer ties to the European Union, has brought Russia's relations with the West to their most fraught since the end of the Cold War in 1991.
After Russian troops took over Crimea last month, officials with the NATO military alliance said Moscow was massing forces on the border with mainly Russian-speaking eastern Ukraine, possibly as a prelude to seizing more parts of the country.
Russian Foreign Minister Sergei Lavrov denied on Friday that this was the Kremlin's intention.
"We cannot have such a desire. It contradicts the core interests of the Russian Federation. We want Ukraine to be whole within its current borders, but whole with full respect for the regions," state-run RIA news agency quoted Lavrov as saying.
The Kremlin intervened in Crimea after President Viktor Yanukovich was pushed out following weeks of protests in the capital that turned bloody in mid-February. He was replaced by a government that wants close ties with the West, but which Moscow says is illegitimate and discriminates against Russian-speakers.
Russia's chief prosecutor said on Friday Moscow would not extradite Yanukovich, whom he called Ukraine's "legitimate president", to face murder charges over protesters' deaths.
REVERSE FLOWS
Though tension was still high around eastern Ukraine, where pro-Russian activists this week seized public buildings in two cities, the focus of the stand-off between Moscow and the West appeared to be moving towards the vexed issue of gas.
A large proportion of Europe's gas is pumped from Russia via Ukraine's territory.
Moscow has said it will cut off supplies to Ukraine if it fails to pay what it owes. But Ukrainian Energy Minister Yuri Prodan told parliament the EU would stand in solidarity with Kiev to blunt the impact of any cut-off or reduction in supplies to Ukraine.
"Ukraine cannot pay such a political, uneconomic price," Prodan said.
If Moscow were to scale back deliveries of natural gas to Ukraine, the effects would be unpredictable.
EU states have said they will reverse the flow of pipelines that deliver Russian gas to them, pumping fuel back towards Ukraine. The volumes involved are small, but they would mitigate a Russian cut-off.
"We are negotiating with the European Union about reverse deliveries into Ukraine," Prodan said. "We will make gas purchases from reverse flows urgently, on the conditions offered by European gas companies."
Officials in Kiev said these would be Germany's RWE and France's GDF Suez, Russia's biggest gold miner, became the first big company to respond, saying it was considering its options. Its shares are listed in London and it is registered in Jersey: "As a company with operating assets wholly located in Russia," Polyus said in a statement, "The board recognises that these developments may have particular implications for the company's business and development plans."
(additional reporting by Denis Dyomkin in Moscow, Alexandra Hudson in Berlin, Barbara Lewis in Brussels, Michael Shields in Vienna; Writing by Christian Lowe; Editing by Timothy Heritage and Alastair Macdonald) nL6N0N33C0