Ukraine exposed an ultimatum to Gazprom

Naftogaz demanded from the Russian gas corporation to undertake the obligation to pump 110 billion cubic meters of gas annually through Ukraine in 2020-2028 and agree to pay 30% more for the rate for pumping in 2018-2019. Otherwise, Kiev threatens Moscow with a $ 11 billion claim.
"Naftogaz of Ukraine" is ready to maintain the rate of transit of Russian gas through Ukraine in 2020-2028 at about the current level. But for this, Gazprom must agree to pump 110 billion cubic meters per year and increase tariffs in 2018-2019 by a third - in total by $ 2.3 billion. Otherwise, Naftogaz intends to recover from Gazprom in arbitration compensation for impairment of its gas transportation system in the amount of up to $ 11 billion. Kommersant's interlocutors, close to Gazprom, call this position "blackmail".

"Naftogaz of Ukraine" became aware of the position of "Naftogaz of Ukraine" on the terms of transit of Russian gas in 2020-2028 - after the expiration of the current transit contract with Gazprom. According to Kommersant's interlocutors, Yury Vitrenko, commercial director of Naftogaz, sent the terms to Gazprom's deputy chairman Alexander Medvedev at the May holidays.

Naftogaz offers such options - an independent booking by Gazprom of the capacities of Ukraine's gas transportation system (GTS) or their booking by Gazprom's customers (the latter actually means the delivery of gas by Gazprom on the eastern border of Ukraine). In these cases, the applicable law for the contract will be Ukrainian, which, Naftogaz insists, is now harmonized with the EU energy legislation. Another option is the sale of gas to Naftogaz on the eastern border of Ukraine with a return purchase of this volume on the western (gas swap). In this case, the transit fee will be formalized as a margin between the transactions, and Naftogaz is ready for a contract under a different law, including in Swedish (as now in transit contract).

As for the level of tariffs for pumping, Naftogaz insists on raising them already in 2018-2019 (that is, within the framework of the current contract), considering them underreported.

The tariff formula now consists of two parts - the rate for pumping 1 thousand cubic meters per 100 km plus the price of "fuel gas" (which Gazprom supplies to Naftogaz). The fuel component is the compensation of Naftohaz expenses for gas burned at compressor stations to ensure transit. Now the full rate of transit, according to the estimates of Kommersant, is $ 2.52 per 1,000 cubic meters per 100 km, including $ 0.65 of the fuel component.

Naftogaz proceeds from the fact that Gazprom, in accordance with the decision of the Stockholm Arbitration, will pump at least 110 bcm per year in 2018-2019 at the Ukrainian gas transmission system (Gazprom does not agree with this). At the current rate without taking into account the fuel component, Naftogaz will receive $ 2.55 billion of revenue per year. But Ukrainians want $ 3.7 billion - with a tariff increase of about 33%. The company on March 13 sent a notice to Gazprom about the revision of tariffs, and if the parties do not agree, it is going to go to arbitration. After 2019, Naftogaz considers a tariff revenue of $ 2.7 billion a year without a fuel component (an increase of 3%, other things being equal), but subject to the transit of 110 billion cubic meters per year. Ukrainians offer to postpone increased payments for the years 2018-2019 for 2020-2028, then in the next two years the tariff will not change, and then the average payment will be $ 3.2 billion per year.

Gazprom not only is not going to pump 110 billion cubic meters, but publicly declares about the future decrease in transit through Ukraine to 10-15 billion cubic meters (in reality, it is possible not earlier than 2021, see "Kommersant" on March 30). According to Kommersant's interlocutors, Gazprom took a position in the negotiations that, after 2019, the payment for transporting gas from the Russian border to Germany through the central corridor (Ukraine, Slovakia, Czechia) should be comparable to the tariff for the construction of the Trans-Baltic gas pipeline Severny flow-2. " According to Naftogaz calculations, in this case the tariff through Ukraine should drop 2.5 times, to $ 1 per 1,000 cubic meters per 100 km.

According to Kommersant sources, if Gazprom insists on reducing tariffs or refuses to guarantee the loading of the GTS into 110 billion cubic meters, Naftogaz wants to demand compensation for the depreciation of the GTS in arbitration because of incomplete payback of investments. The amount of depreciation at a tariff of $ 1 and transit to 13 billion cubic meters is estimated by Naftogaz at $ 11 billion, with a current tariff and transit of 65 billion cubic meters - $ 6 billion. Gazprom declined to comment, Naftogaz did not respond to a request .

Alexander Medvedev, Deputy Chairman of the Board of Gazprom, April 24: The current (transit. - "b") contract under no circumstances, even with the change of the sun and the moon, will not be prolonged. The ball is on the Ukrainian side - they must justify the attractiveness and the possibility of transit.

The interlocutor of Kommersant, close to Gazprom, calls Kiev's approach "blackmail", explaining that the Russian company therefore terminates the current transit contract at the Stockholm Arbitration: "It's even funny to consider." Another source of Kommersant in the industry believes that the delivery of gas on the Ukrainian border is traditionally unacceptable for both Gazprom and its European consumers, and the option with a swap carries only additional risks, "since it is not known what Naftogaz will do with this gas. " According to him, preliminary in the framework of future negotiations with the EU, a variant is discussed with the reservation of GTS capacities for 30 billion cubic meters per year, that is, the capacities will be paid, not the volume of transit.

"Now the early stage, the negotiations have not really started, and both sides, naturally, will ask for a moon from the sky," says the source in the industry. He believes that Naftogaz wants to maximally monetize the positive decision of Stockholm for transit and tries to play on Gazprom's fear of new arbitrations. "Ukraine makes it clear that it has nothing to lose, unlike Gazprom, which needs to be supplied to consumers after 2019," says a Kommersant source.