“Doesn't look like a compromise”: Ukraine has calculated new tariffs for the transit of Russian gas to Europe

The Ukrainian state-owned company Naftogaz calculated the possible tariffs for the transit of Russian gas to Europe for various volumes of annual reservations for the next five years. This was reported by Interfax-Ukraine with reference to the press service of the company.

According to published figures, in the case of booking 60 billion cubic meters of transit capacity of the gas transmission system (GTS) of Ukraine, the tariff for 2020-2024. will be $ 3.21 per thousand cubic meters per 100 km. When booking 90 billion cubic meters, the price will be reduced to $ 2.56.

It is noted that in 2019 the transit tariff for Russian gas is $ 2.61 per thousand cubic meters for every 100 km.

These data were released after another round of trilateral gas talks took place in Brussels, in which senior representatives of Russia, Ukraine and the EU took part.

In particular, at this meeting, the Ukrainian side presented the concept of the future operator of the Ukrainian gas transportation system, which was called OGTSU LLC (Ukrainian gas transmission system operator). It is reported that during the negotiations, representatives of the new company handed over to the Russian side draft agreements on cooperation between operators of adjacent gas transmission systems and a standard transportation agreement.

In addition, Naftogaz gave the Russian delegation a roadmap of the actions necessary to complete the separation of the GTS operator into an independent structure.

On Wednesday, September 18, the Ukrainian Cabinet updated the plan for separating natural gas transportation activities from Naftogaz Ukrainy. Then it became known that the newly formed company will be subordinate to the Ministry of Finance of the country.

“The proposed model of the branch will provide the prerequisites for creating a transparent and efficient structure of the GTS Operator, introducing European standards of work, ensuring the real independence of the GTS Operator, certified in accordance with the requirements of European law,” quoted Gromadske as Minister of Energy and Environmental Protection of Ukraine Alexey Orzhel.

Commenting on the figures given by the Ukrainian side, Deputy General Director for Gas Issues of the National Energy Security Fund Aleksey Grivach stated that these prices significantly exceed the tariffs on alternative routes for delivering Russian gas to European consumers.

“Despite the fact that there is no serious program to maintain and develop capacities in Ukraine,” the source said, adding that, taking into account these tariffs, the rates of return will not correspond to European standards.

“Ukraine is switching to European legislation in the gas sector, and it assumes that transport companies have profit margins in the range of 3-5%. With the tariffs now offered, it will be about 50-60% and this is unacceptable, ”the expert said.

At the same time, he drew attention to the fact that the data on probable tariffs were published by Naftogaz, which would soon lose control of the GTS.

“The question is, what is Naftogaz related to tariff calculation. She should not be a participant in the process. Tariffs can only be determined by an independent regulator, ”emphasized Grivach.

"Maximize towards each other"

Recall that the current contract governing the transit of Russian gas through the territory of Ukraine expires on December 31, 2019. So far, the parties have not been able to reach an agreement on its extension or the conclusion of a new agreement.

At the same time, the participants in the recent talks held on September 19 praised the positive atmosphere and constructive nature of the conversation.

“We discussed a lot of issues, and specific issues related primarily to gas supplies to Ukraine. We believe that this is a very important issue in order to talk about gas transit and the volumes that will be from 2020, ”said Alexander Novak, head of the Russian Ministry of Energy, following the meeting.

Representatives of Kiev also positively evaluated the negotiations and noted that they are set to sign a new agreement on the transit of Russian gas.

“We do not allow such an option as the non-signing of the contract,” Alexei Orzhel quotes TASS. “The parties should move towards each other as much as possible.”

Note that at the end of 2018, Ukraine reduced the transit of natural gas through its gas transportation system by 7.1% to 86.8 billion cubic meters. As reported in January 2019, transit to Europe for the year amounted to 83.8 billion cubic meters, which is 7.6% lower than in 2017.

The Ukrainian political scientist and economist Alexander Dudchak, in a conversation with RT, expressed the opinion that in the negotiations on gas issues, Kiev so far offers exclusively those options that suit the Ukrainian side.

“So far, this does not look like a compromise. The numbers are very high and this is unlikely to suit Russia, ”the expert said.

At the same time, he admitted that we are talking about primary calculations and more realistic figures will be published in the future. However, he also recalled that Naftogaz has so far not shown noticeable flexibility in negotiations with the Russian side, in particular, in matters of litigation with Gazprom in the Stockholm arbitration.

“In addition to such transit conditions, no ideas were expressed on the termination of litigation, on the search for optimal solutions for both parties,” concluded Dudchak.