EU for talks with Ukraine; against a Gazprom-Naftohaz Ukrainy merger

European Union Energy Commissioner Gunther Oettinger, who earlier disdained a proposal by Russia’s Prime Minister Vladimir Putin, said Brussels and Kiev have agreed to intensify their discussions on energy.

Eric Watkins
OGJ Oil Diplomacy Editor

LOS ANGELES, May 11 -- European Union Energy Commissioner Gunther Oettinger, who earlier disdained a proposal by Russia’s Prime Minister Vladimir Putin, said Brussels and Kiev have agreed to intensify their discussions on energy.

“We had a very constructive discussion on future cooperation in the energy sphere between Ukraine and the EU,” said Oettinger after a meeting with Ukraine’s Fuel and Energy Minister Yuriy Boiko.

“We…agreed to intensify the discussion and establish a personal contact to guarantee a pragmatic and measurable result that we should achieve in all areas of our cooperation,” Oettinger added.

The commissioner’s upbeat remarks were in contrast to his relative silence over Putin’s earlier proposal to merge state-owned OAO Gazprom with Ukraine’s national oil and gas firm Naftogaz.

Oettinger said there is no reason for the EU to take any action regarding the proposal, which arose in an Apr. 30 meeting between Putin and Ukraine’s Prime Minister Nikolai Azarov.

“A decision has to be made between Kiev and Moscow and not in Brussels,” he said.

“I am very pleased that Ukraine remains committed to accession into the EU energy community, and we have discussed the best ways to ensure that this process is completed as soon as possible,” Oettinger said.

According to Boiko, the gas laws that are needed to complete the procedure of acquiring energy community membership could be passed by Ukraine’s legislature in “the next few weeks, because we have a majority.”

Putin’s proposal, described by Ukraine President Viktor Yanukovych as an “offhand remark,” was slammed by opposition politicians who said a merger would be a de facto takeover of Naftogaz by Gazprom.

Ukraine's opposition politicians were incensed by a recent agreement for Moscow to sell gas to Kiev at a 30% discount in exchange for Russia's Black Sea Fleet being allowed to extend its base on Ukraine's Crimean Peninsula (OGJ Online, May 3, 2010).

Oettinger said he and Boiko had a chance to discuss changes in the terms of Russian gas transit to European consumers via Ukraine, but the commissioner did not give details of that discussion.

Last month, Oettinger traveled to Moscow for 3 days of talks with senior Russian officials before moving on to Turkmenistan and Azerbaijan for further discussions about securing and diversifying European gas supplies (OGJ Online, Apr. 26, 2010).

The EU reportedly receives 44.5% of its total gas imports and 33% of its total crude oil imports from Russia.

Contact Eric Watkins at hippalus@yahoo.com.

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