Russia and Ukraine seek to resolve gas row
MOSCOW (Reuters) - Russia and Ukraine will on Saturday seek to resolve a contract dispute that has cut gas supplies to much of Europe for more than two weeks in the depths of winter.
The row has angered the European Union and led to increasing doubts about the reliability of Russia and Ukraine as a source and transit route respectively for gas supplies to Europe and led to an apparent rift between Ukraine's president and prime minister.
Russian Prime Minister Vladimir Putin said on Friday after talks in Germany that Moscow was nearing a deal to deliver gas to European customers.
He will have talks in Moscow on Saturday with Ukrainian Prime Minister Yulia Tymoshenko. Top officials of the Ukrainian state energy firm Naftogaz are also due in the Russian capital.
The European Union imports a quarter of its gas from Russia and 80 percent of its supplies come via Ukraine.
The row takes place against a backdrop of strained political ties between Moscow and Kiev. Russia is angered by Ukraine's aspiration to join NATO and by its support for Tbilisi during the Russian-Georgian war in August.
"We are approaching interesting agreements which could lead to a solution," Putin said after meeting German Chancellor Angela Merkel in Berlin on Friday.
In Kiev, however, Tymoshenko and President Viktor Yushchenko appeared at odds over the terms of any deal for Russian gas to transit their country.
SUPPLY CONTRACT
Yushchenko said the issue of renewing Russian gas supplies to Europe was linked to finalising a 2009 supply contract for Ukraine, while Tymoshenko said the two issues were not connected.
Tymoshenko and Yushchenko have been at odds almost from the day she came to office two years ago but they had appeared to have a united position during the row with Moscow since it cut all supplies to Ukraine on New Year's Day.
"The issue of natural gas supplies to Ukraine and the issue of transit are interlinked and must be discussed as a single package," Yushchenko's office said.
Such a link may delay the resumption of gas supplies to the 18 European countries that have been affected by the cut-off.
Tymoshenko set conditions for the weekend talks, refusing to accept intermediaries in gas deals and ruling out any selloff of Ukraine's pipelines. She also demanded that Ukraine speak with one voice in the negotiations.
"Simply speaking -- I need two things: Don't throw a spoke in the wheel and don't stab any backs," she said.
In his remarks in Germany, Putin welcomed a deal with a consortium of European energy companies to provide technical gas, which is needed to pressurise the pipeline network and allow supplies to be pumped from Russia to Europe through Ukraine.
"We approached our main Western partners -- E.ON Ruhrgas, Gaz de France, ENI and our Austrian partner -- with a request to share the risk of supplying technical gas to Ukraine," Putin said.
Russian energy giant Gazprom said it would sell the technical gas to the European consortium at the prevailing market price of about $450 per 1,000 cubic metres.
The row has focussed minds in Europe about the need to find new routes for gas.
Slovakia, one of the European countries most affected by the gas cutoff, said it would cancel restrictions on domestic gas usage after arranging deliveries through a pipeline bypassing Ukraine.
Merkel called for quick progress on the construction of the Nord Stream pipeline, which will bring gas from Russia to Germany, also bypassing Ukraine.
(Writing by Giles Elgood; Editing by Matthew Jones)